The Biden administration is requiring any semiconductor manufacturer that applies for more than $150 million in subsidies under the Chips Act to submit “plans to provide both their facility and construction workers with access to affordable, accessible, reliable, and high-quality childcare.” This requirement is expected to cover fewer than 200,000 workers, but it is a novel way to use national defense and economic subsidies to invest in an inclusive, family-friendly workforce. Whether it works will depend on the employers’ plans themselves.
The problem is real. Even before the concern over current high rates of inflation, parents struggled with the cost of raising with young children. Having long outpaced inflation, the average weekly cost of childcare was $250 among families with children under age five, or about 10% of their income, according to Survey of Income and Program Participation. The burden is higher for families with less income.
Moreover, the high cost of child care has negative effects on women’s work lives. The U.S. has the eighth-lowest labor force participation rates for prime-age women at 76.9% among Organization of Economic Cooperation and Development countries. That includes Japan, in which participation has risen almost 10 percentage points in the past decade while pursuing active labor market policies for women, including more accessible daycare.
