The Child Care Opportunity Index

Introduction

Child care represents an increasingly large portion of parents’ household income in America. Despite the U.S. Department of Health and Human Services’ benchmark that affordable child care is not greater than 7% of household income, the national average exceeds this amount, and in Colorado ranges between 10.5% (Cheyenne County) and 38.2% (San Juan County) depending on the county. In dollars, for those same two counties, monthly costs range between $554 and $1,193 per child, but there are counties in which the average monthly cost is as high as $1,645. Colorado ranks 5th in the country for the most expensive infant care. 

The low availability of licensed child care spots adds to the headache for parents seeking care. Overall, 51% of Colorado is in a child care desert, meaning there is a scarcity of spots compared to the number of children needing care. A desert is defined as a census tract with more than 50 children under five years old that contains either no child care options or so few that there are three times as many children as licensed spots. 

The combination of high cost and low access can lead parents to leave work until their children are older, leading to lost wages and career setbacks due to time out of the labor force. Younger adults are considering child care challenges as a major deterrent to having children, leading to lower birthrates and demographic shifts over time. Businesses can struggle to keep employees when they struggle with child care.

Addressing child care challenges will require multi-sector community involvement. Because affordability and availability look different across the state, communities should consider their specific conditions to develop the best solutions for families in their area.

Key Findings

Child Care is a Major Financial Burden

• The average monthly cost of child care across the 10 most populous counties in Colorado ranges from $911 (Pueblo County) to $1,645 (Boulder County) per child.
•  In the 10 most populous counties, the share of income required for child care exceeds the federal affordability benchmark of 7%, reaching up to 25% of income in Weld County and 18% in Denver. In the city of Denver, that’s equivalent to a family of four’s groceries for a year and a quarter, at $288 per week.
• Parents earning minimum wage in Denver must work over two full days per week just to cover monthly child care costs.
• The cost of child care is outpacing inflation. From 2020 to 2024, the price of child care and preschool rose 29%, while overall prices rose 22%.

Widespread Shortage of Licensed Child Care

• Only four of Colorado’s 64 counties have enough licensed child care slots for the number of children under age six.

Child Care Affordability Index

• Out of the 62 counties included in the index, no counties had both affordable and available child care.
•  Twenty-three out of the 62 counties had neither affordable nor available child care.

What Child Care Cost Parents

Data gathered across all counties in Colorado suggests a monthly cost range per child between $486 in Otero County to $1,645 in Boulder County, with an average of $1,001 and a median cost of $950 per month. 

Figure 1 below shows the average monthly cost of child care across the state’s ten largest counties. Annualized, these figures equate to an average of 20.3% of average wage spent on child care for the state’s 10 largest counties. Even the lowest percentage of household income spent on child care—18.3% in Denver County—is more than double the U.S. Department of Health and Human Services’ recommendation that to be considered affordable, child care cost should not exceed 7% of a family’s income. The Center for American Progress reports that across the U.S, more than half of working families with children under the age of five pay for child care, and across all families, 10% of monthly income is spent on child care. When family income is less than 200% of the poverty level (less than $50,000 for a family of four), the share of income going to child care reaches 35%. This problem is not unique to Colorado. 

Though this report primarily looks at the cost of child care, and the number of licensed child care slots, it is important to note that the geography and setting of child care significantly impacts the cost. In counties with larger populations, child care costs are higher for younger children. Additionally, child care centers overseeing large numbers of children grouped by age cost more. This is likely due to the higher costs, such as real estate and labor, associated with operating child care centers in more highly populated areas.

 Figure 1

Figure 1:

Child Care Costs Compared to Income by County

In recent years, attention has been focused on the cost of child care because costs are rising at a rate greater than inflation. From 2020 to 2024, the price of child care and preschool rose 29%, while overall prices rose 22%.

According to the Economic Policy Institute, Colorado is one of 38 states in which child care exceeds the cost of in-state tuition for a four-year public college. The cost of child care also exceeds that of regular monthly expenses such as rent, transportation, basic utilities, and food. Figure 2 below shows what percentage of the average monthly wage is necessary to cover one month of child care across the largest counties in the state. 

Figure 2

*The average depicted is a weighted average that accounts for child care enrollment varying widely between centers. Cheaper child care options often offer fewer enrollment slots and face higher demand. Additionally, the cost depicted encompasses all care for children under six years old including both home and center care.

One way to measure the cost of child care is to consider how many hours of weekly work go toward paying for care. For comparison, Figure 3 below shows the number of hours a parent must work at minimum wage and the average wage to afford care in the state’s most populous counties. For a parent working at minimum wage in Jefferson County, over half of each week—23.1 hours—are required to cover the cost. At the minimum wage in Denver, more than two days of each week (19.3 hours) are required to cover the cost of care. 

At the average wage across the ten most populous counties, 7.3 to 9.9 of the hours worked each week are needed to cover the cost of child care. Weld County has the highest child care burden, requiring 9.9 hours of work per week at the average wage to cover the cost.

Figure 3

Figure 3:

While it is well established that child care is expensive and burdensome for families with young children, availability is also a significant challenge. Fifty-one percent of Colorado is in a child care desert, with too few child care slots for the number of children needing them.

Figure 4 below shows the slots relative to the number of children for the largest counties in Colorado. None of them have enough slots for children six and under. Despite having the lowest average cost of the counties listed, Pueblo also has the lowest supply.

Figure 4

Figure 4:

Child Care Opportunity Index by County

Figure 5 displays an index that shows the relative challenge of child care in both affordability and availability for counties in Colorado. 

The Affordability portion of the Index is constructed relative to the average, so, for instance, Adams County’s value is: 

Affordability Part of the Child Care Opportunities IndexAdams County= Percent of Wages Devoted to Child CareAverage Across CountiesPercent of Wages Devoted to Child CareAdams County=21.09%21.94%∙100=96

This indicates that Adams County’s affordability is less than average (Residents in Adams County spend more of their wages on child care). Essentially, a lower affordability index value (e.g., below 100) indicates more expensive child care costs relative to wages and above 100 indicates less expensive relative to other counties. 

Additionally, the Availability portion of the Index is calculated as the number of slots per children under age six. An index value less than 100, say 90, means that there are fewer than one slot per every child under age six. 

In the Adams County example below, the county has low availability, which is indicated by an index value of 32, well below the average of 57.

Availability Part of Child Care Opportunities IndexAdams County=Licensed spotsAdams CountyChildren under 6Adams County∙100=12,63339,650∙100=32.

Plotting across both variables can help to identify which issue needs to be addressed as a higher priority in a particular locale; affordability or availability.

Figure 5 below helps to tell the story of the child care challenges across the state by showing all counties in Colorado relative to affordability and availability of child care. Counties to the left on the chart are generally less affordable than average; to the right are more affordable than average. On the y-axis, the higher the index value, the more availability. An index value of 100 means that there is one slot per child under age six in the county. Generally, where affordability is greater, availability of slots suffers.  

Top Right Quadrant – Most desirable, child care is more affordable and available

Top Left Quadrant – Child care is more available but less affordable

Bottom Right Quadrant – Child care is more affordable but less available 

Bottom Left Quadrant – Least desirable, child care is less available and less affordable

No county plots into the desirable upper right-hand quadrant as having ample availability and affordable child care.

Figure 5

Figure 5:

 

Figure 6 depicts the child care opportunity index score for affordability and availability among Colorado’s ten most populous counties and ranks them best to worst. The counties are ranked by summing each county’s affordability and availability index scores. Boulder performs the best, with a score of 162, while Weld county ranks last with a score of 114. 

The remaining counties’ scores can be viewed in the appendix of this report. 

Figure 6

Figure 6:

 

Why it Matters

Lack of affordable and available child care can lead parents, particularly mothers, to leave the workforce. 60,000 more moms with children under six would be in the labor force if they had the same participation rate as moms with children over six. These mothers represent both the near-term economic impact of unrealized wages as well as a longer-term impact on career advancement and increased earnings throughout their careers. This can be particularly true for single mothers who face greater challenges in balancing work and child care needs. 

Employers report the impact of insufficient child care on their employees leads to decreased productivity and potential revenue loss as a result. The challenge of keeping parents as employees can mean higher turnover and increased cost of hiring, as well as the risk of insufficient staff to operate. 

Additionally, the challenge of child care is reported by young adults as a prime reason for not having children. In a 2018 survey, 64% reported the cost of child care as a reason to have no children or fewer than they might like. Lower fertility rates mean that while the population ages, fewer workers will move into the labor force to support the needs of the entire population. 

Options to Address the Availability-Affordability Issue

While future reports will look at this issue and possible solutions in greater depth, the challenge across the state is clear. Communities must find a balance between affordability and availability of child care. Using a systems approach to examine each community's child care needs may present solutions that are not immediately obvious. For instance, rural communities may benefit from a mix of friends, family, and neighbor care, home-based and center-based care. 

To create a better environment for families, urban communities may need help from the business community and local municipalities to increase affordability and availability through operational subsidies, real estate, and other forms of tax credits to ensure the state has the workforce it needs. Regardless, the workers sidelined from the labor force due to child care issues present a lost GDP opportunity that must be addressed.

Appendix

Child Care Cost by County

Figure 7 below shows the share of the average wage spent on child care in each county across the state. Even the least expensive counties, Bent, Cheyenne, and Otero, exceed 10% of the average wage.

Figure 7

Figure 7:

 

 

Child Care Slots and Children by County

Of the 64 counties across the state, only four report more than one slot per child under six years of age. 94% have fewer than one licensed slot per child under age six. This means that many parents needing child care have to find alternatives to licensed care. 

Figure 8

Figure 8:

 

Child Care Opportunity Index by County 

Figure 9 shows the data plotted above in color-coded form. Data is sorted by the combined values of the Child Care Opportunities index, which equally accounts for both affordability, and availability. Of the state’s counties, more than one-third (37%) fall into the less affordable-less available quadrant. Only 5% are less affordable but more available. And 56% of the counties have more affordable-less available child care options. No counties are more affordable and more available.

Figure 9

Figure 9: