Thirty new childcare openings will soon be available in Steamboat Springs, Colo.
This may not seem like national news, but in this expensive resort town where parents have gone as far as sleeping outside childcare centers in order to secure a spot for their kids, every single new opening likely means the difference between a parent working or not.
What's happening in America’s ski towns has mirrored the problems facing much of American. Costs of living have soared as home prices skyrocketed during the pandemic amid the flight of the wealthy to more remote areas. Both year-round and seasonal resort staffers have been feeling the squeeze, with some taking to sleeping in cars and campers because there's not enough affordable housing.
The influx of new residents has also put pressure on amenities like childcare—an industry already suffering a major staffing shortage. Despite gains in recent months, childcare employment is still down 8% from pre-pandemic levels, according to the latest analysis from the Center for the Study of Child Care Employment (CSCCE) at the University of California, Berkeley.
The dire care situation in Routt County, Colo., caught the attention of employers, including the Steamboat Ski Resort. In order to provide childcare support for both its year-round and seasonal workers, as well as community members, the resort took the bold step of opening up its own childcare center.
“Childcare should just become an expectation. I think it should become a point where it's [a benefit] like 401(k)s—you expect that from most companies now, especially large companies,” says Loryn Duke, Steamboat’s director of communications and one of the people leading the childcare project for the resort. “I think it's a really smart move for businesses moving forward.”
When employees started coming back to the Steamboat offices last year after the initial COVID-19 waves in 2020 pushed many Americans to work from home, there were several with young children who were unable to find childcare, Duke says. It’s a situation she’s familiar with—she’s also a mom, and she spent weeks calling local childcare centers to find a spot for her daughter when she came back from maternity leave in 2021.
But just a year later, the childcare situation is perhaps even more fraught now, in part because Steamboat, like other employers, is battling a tight labor market. “We were having employees who were on the verge of quitting because they just had no other options,” Duke says. And losing talented employees because they lacked childcare wasn’t something anyone wanted.
This isn’t a new problem in Colorado: In 2019, licensed childcare providers were only able to serve about 62% of the state’s children in need of care, according to a 2021 report from Kids Count in Colorado. But it took the pandemic, increased awareness of the childcare crisis, and a tight labor market to push corporate leaders to really put something in motion.
Across the country, employers are increasingly on the frontlines of the childcare crisis as working parents struggle to find care. About 4.3 million Americans reported they’re currently not working because they need to watch their children, according to the latest Household Pulse Survey from the U.S. Census Bureau.
More broadly, nearly one in three parents have had to leave their jobs at some point to care for children, according to a survey on the costs associated with having children fielded earlier this year by Credit Karma.
Many times, a lack of childcare comes down to cost. Parents with children under the age of 5 paid nearly $1,350 a month, on average, for childcare, according to Census data. As a result, the most common source of childcare in the U.S. tends to be relatives, including grandparents.
Even among parents who can readily afford childcare, accessing it is a major hurdle. Yet it’s rare that employers step in to offer support. But Duke says the resort felt it had to help, given the lack of childcare openings was affecting employees’ ability to stay in the labor force. Simply subsidizing the cost of childcare isn’t helpful if there’s none to be had.
Opening a childcare center is no picnic
So how does a company go about opening their own childcare center? Lots of help, Duke says. Not only from the resort and corporate leadership, but also from the state, other childcare providers, business groups, and even the local community.
Steamboat’s childcare project kicked into high gear in October 2021 after Duke and several other resort employees pitched their idea of an on-site childcare center for staff. Corporate leaders immediately supported the project, especially given that there were not only the usual tax breaks, but also state grant money available to help fund the venture.
Colorado’s Department of Human Services had recently enacted the Employer Based Child Care Facility Grant, which offered employers like Steamboat up to $500,000 in matching grant funds to open a childcare facility specifically for employees to help alleviate the crisis.
To help employers navigate the process, the state funded a grant that allowed the business group, Executives Partnering to Invest in Children (EPIC), to establish a five-month Employer-Based Child Care Design Lab. Steamboat was among the first of nine employers that actively participated in the program.
Duke and her team—the only ski resort chosen to participate—underwent training from October 2021 through March 2022, learning not only about state childcare childcare licensing, building codes, staffing levels, and regulatory requirements, but also about how to apply for state grants and even financing methods.
“We know that there are a lot of other potential barriers to entry even if you have the money and the will to open up a childcare program,” says Alethea Gomez, EPIC’s director of programs and initiatives. Gomez tells Fortune that the program provided support and helped employers “connect the dots” on a variety of complex issues that can come into play, such as zoning laws and even supply chain challenges.
The first priority for Steamboat? Hire an executive director to bring a level of expertise to the project. Steamboat hired Sarah Mikkelson in January 2022, and she was on-hand for the final months of the Design Lab training.
Next came the actual site of the center, which Steamboat secured in July. Corporate leaders agreed to renovate a building that used to house a medical practice, which is within walking distance from the resort’s employee housing.
Also helping the equation is that as a ski resort, Steamboat does offer limited employee housing. So while the widespread childcare industry is still experiencing staffing shortages, Duke says they were able to look further afield for workers because they could offer subsidized housing as an added benefit.
But it hasn’t been easy. Steamboat invested heavily in the start-up costs of the center, kicking in more than half a million dollars, Duke says. Additionally, the resort expects to subsidize the program at $200,000 per year on an ongoing basis.
“Sometimes employers may come into this thinking that they could have a break-even business model in offering on-site or near-site childcare,” Gomez says. But most employers eventually realize that if they want a high quality program that is meeting quality standards, that does not charge families exorbitant tuition rates, and also pays the teaching staff a livable wage, there’s an investment required in that facility year over year.
The financial conversations definitely took a lot of research and fortitude, Duke says. “Everything comes down to budgets,” Duke says. “And it's really hard to sell a line item that is not going to be your revenue driver, right? It’s absolutely going to be a loss center.”
Perhaps the biggest contention point was infant care. Duke says initially, corporate leaders wanted to scrap infant care because it’s incredibly costly given the ratio of teachers to children has to be very low. “Yes, infants are hard. And the math on that never adds up,” Duke says. “But we pushed back really, really hard because infant need is the biggest need in our community,” she says, adding that there’s only one other center in the area that takes babies, and they too only have limited spots.
Yet with most of the heavy lifting now behind the team, the Steamboat Child Care Center is set to open on Dec. 19, with 19 spaces allocated for staff and 11 spaces available for community members—though these numbers are in flux. The center is expected to serve infants to children up to 5 years old.
When the new center opened for registration, there were 49 parents who applied for the six community spots. “This is the heartbreaking part, but it shows the need,” Duke says.
Resort staff do get first dibs on open slots and the benefit is open to all employees. However, full-time, year-round staff get first priority, followed by part-time, year-round, then full-time seasonal, part-time, seasonal, and finally community slots. Prices will start at $64 per day for staff—slightly less than the current community average of about $78 per day, Duke says.
“We couldn't bring down the affordability to an amazing rate. I think we all had visions of like $20 a day,” Duke says. “It is more affordable, but there's no denying the fact that childcare is expensive.”
For now, Duke says the center is focused on addressing the lack of accessibility by increasing the number of available childcare slots in the community. Hopefully somewhere down the line, affordability will be something that can be addressed too, she says.
Getting more private and public partnerships in place
The accessibility and affordability of childcare is a crisis that isn’t going away anytime soon in most communities across the U.S. Which is why, absent passing major federal legislation, many experts say it’s going to take a combination of state and local public resources paired with private investment to really make a dent in the current situation.
While getting employers involved is a tough sell, it’s not impossible—as Steamboat Ski Resort clearly shows. “Employers and business voices have power and influence,” says Nicole Riehl, EPIC’s president and CEO. “And when they speak for children and families—and support early childhood investments and policy solutions—our policymakers listen.”
There does need to be “meaningful change” around the legislation and regulation of childcare at all levels of the government in order to improve the on-the-ground conditions for providers, parents and children, Riehl says. But programs like the Design Lab can help drive change, too, giving organizations a “very clear roadmap and process” on how to get from concept to completion in their efforts to create on-site or near-site childcare in their communities.
Since the launch of the Design Lab, Riehl says EPIC has fielded requests from other states, business groups, and nonprofits on how to set up similar initiatives. And Colorado renewed the grant supporting the program, so EPIC is set to host another class of employers interested in standing up their own childcare solutions. Of the nine active participants, Gomez estimates about half are still pursuing their childcare projects. Fellow Design Lab participant Community Hospital in Grand Junction, for example, broke ground on their new 7,500-square-foot childcare center in November.
Yet even with help from state grants and the Design Lab, Duke says it’s not an easy path. The team at Steamboat assumed that because the resort is a big corporation—it has in-house human resources, finance, security, and even runs a kids camp for resort guests—existing resources could simply be utilized for the childcare center too. But many of the requirements are different and needed specialized solutions.
Looking back, Duke admits she went into the process a bit naive. And if she were to do it again, she would instead partner with an established entity like Bright Horizons or KinderCare and let them drive the start-up process. In addition to the start-up costs covered by the resort, Duke and the marketing director, Morgan Bast, spent 20-30 hours a week working on the project in the beginning. And even now, Duke estimates she still spends 10 hours a week on childcare center operations.
Projects like Steamboat Ski Resort’s childcare center do have wider ripple effects and showcase the need for more employer-sponsored aid. Not only can employer-based daycares help the wider community by opening up childcare slots at other centers that were once being used by their employees, but they can set trends. At the resort, for example, entry-level wages for teachers and childcare staff are typically above $20 per hour, Duke says. That can help bring wages up across the community in a sector that’s been historically subject to low pay and few benefits.
The childcare center at Steamboat Ski Resort also sends a tangible message that employers listen and take steps to support their workers. When the resort made the announcement, Duke says she was overwhelmed by the number of staff members without children who were very excited about this.
“I knew that there would be a niche group that would be really excited, but to see everyone else understand the importance of it and be excited about the announcement—that was pretty special,” Duke says.
