Subsidizing child care costs would reduce poverty and enhance equity among New England families

New research from the Federal Reserve Bank of Boston and the Carsey School of Public Policy explores how proposed policies to cap child care expenses based on family income would affect poverty rates among New England families. Using the Supplemental Poverty Measure, the brief finds that such a policy could reduce poverty among New Englanders with child care costs by 40 percent; with the largest absolute declines for Black and Hispanic New Englanders, this would result in a substantial shrinkage of the racial-ethnic poverty gap. The effects of such a policy are not limited to the lowest income families either though: 9.5 percent of near poor New Englanders in families with child care costs would be lifted above twice the poverty line by such a policy. Although implementation would require careful planning, benefits would likely extend beyond poverty reductions, with families better able to participate in the labor force or access higher-quality care for their children. #racialequity #childcare #NewEngland #workforce