In March, the pandemic hit the child care business that Kelly Kiihne spent the past two decades building like a wrecking ball.
Enrollment at Kelly’s Kids dropped 50% as people began working from home, lost their jobs or feared the virus sweeping the globe. Kiihne had to lay off seven of the 40 employees that work at her two centers, and she shifted hours to keep other employees on the payroll.
“It’s been very stressful,†she said.
She applied and received a small business loan as part of the federal relief package and got another relief grant that’s helped keep her afloat. She’s not sure she’d still be here without that help.
“It was getting pretty thin,†she said. “It was getting scary.â€
Her experience isn’t unique, according to a survey of more than 1,000 Nebraska child care providers by the Buffett Early Childhood Institute at the University of Nebraska.
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More than half of those who responded to the survey said they would likely close if the pandemic worsens, and 87% of them said they’d apply for more assistance were it offered.
Like Kiihne, many of them already have: 584 child care providers in Nebraska got federal small business loans through the federal Paycheck Protection Program, including 331 (35%) of the survey respondents. And 990 providers got $1,000 in private grants administered by the Nebraska Children and Families Foundation, including 610 (64%) of those who responded to the survey.
Most of the providers used the $1,000 grant to help pay for cleaning supplies, but many also used the money for food, formula, rent, payroll, mental health services for staff or utilities and insurance.
While Congress debates a new relief package, more Nebraska child care providers will get $1,000 grants through CARES Act money directed to them by the governor, said Kathleen Gallagher, director of research and evaluation at the Buffett Institute.
“I think an important point is that federal and state assistance was helpful but not sufficient to eliminate the needs,†Gallagher said, because even before the pandemic hit, child care was a seriously underfunded system.
“Providers are experiencing really profound economic effects and absolutely need assistance to continue,†Gallagher said.
State Sen. John Stinner of Gering introduced a resolution last week for a study on the fiscal and economic impact of the pandemic on the child care workforce, as well as federal and state investments and options for closing the funding gap.
Child care centers were much more likely to have applied for the federal funds (78%), compared with in-home providers (21%), which Buffett officials said could be because in-home providers may not have known they were eligible or had no help with the application process.
And center-based child care was hit particularly hard, in part because of the directed health measures put in place by the governor that restricted the number of children that could be in one room.
More than 40% of the centers reported they were operating at between 26% to 50% capacity. But in-home providers operate on such narrow margins that they, too, suffered from the impacts, Gallagher said.
Thirty-five percent of center-based owners said they’d lost more than half their income, as did 21% of home-based providers. And nearly 83% of all providers who responded to the survey experienced some loss of income.
Ultimately, it could be problematic for families, Gallagher said.
“What this report suggests is that families going forward might have trouble finding care if child care providers start to go out of business,†she said. “There’s a risk.â€
More than 60% of providers reported suffering from emotional stress because of the impacts of the pandemic on their businesses. Some providers also reported experiencing increased racial discrimination because of the perception that their race or ethnicity was more prone to COVID-19, the survey report notes.
Still, almost all said they had been able to cope.
“They are resilient and doing well,†Gallagher said. “That’s such a Nebraska story.â€
A couple of things have helped: a policy change in April that allowed providers to bill clients who received child care subsidies for days the children were absent, something not previously allowed; and the that connects providers with families who need care.
Things are beginning to improve at Kelly’s Kids, Kiihne said, as people begin going back to work. She estimated both centers are back to 75%-80% enrollment.
But she’s struggled to hire employees, and providers' greatest fear is having a positive COVID-19 case. She had a scare earlier, when some of her employees were exhibiting symptoms. They all tested negative, but the centers had to close down for a short time and hire someone to deep clean.
“It’s definitely hard to keep a level head with all the stress,†she said. “We are all ready for it to go away.â€