The report reveals that childcare costs are rising even faster than sky-high inflation

The cost Americans pay to provide childcare for their children has risen dramatically since 2019, outpacing overall inflation, which has also risen substantially, according to the Bank of America Institute (BofA).

The average child care payment has risen 32% since 2019 to $700 a month in September, hitting middle- and upper-income households hardest. seconds to the data collected by the BofA Institute. In that same time period, headline inflation, as measured by the consumer price index, rose 20% after a highly inflationary period since President Joe Biden took office in 2021. seconds in Axios.

“This could have a significant impact on consumers because more than 12 percent of American households pay for child care on a regular basis, according to the Department of Health and Human Services, and any additional price increases would disproportionately affect to families with small children”. says the BofA Institute report. “According to a recent Care.com survey, for parents who pay for child care, 67% already spend 20% or more of their annual household income on these services.”

Specific child care costs could rise further as the Child Care Stabilization Program of the 2021 American Rescue Plan expired on September 30 and provided subsidies to child care providers, presumably reducing costs , according to the BofA Institute. Families with children are using their savings to pay for higher costs, drawing on their savings at a higher rate than the general population year after year.

Cities like San Francisco and Seattle had the highest increases in child care costs since 2019, while Charlotte and Miami saw smaller increases, according to the BofA Institute. Compared to this time last year, child care costs in Tampa rose the fastest at 12 percent, while New York saw costs drop 2 percent.

Inflation has remained elevated as it peaked at 9.1% in June 2022, with 3.7% in both September and August, far short of the Federal Reserve’s 2% target. In response, the Fed has raised its federal funds rate to 5.25% and 5.50%, the highest rate in 22 years.

Economists have it pointed out to Biden’s economic policy, which has high-spending programs, as the cause of the inflation observed during his tenure. The president approved $1.9 trillion in new spending in the American Rescue Plan in March 2021 and signed the 2022 Inflation Reduction Act, which added $750 billion in new spending.

The White House did not immediately respond to a request for comment from the Daily Caller News Foundation.

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