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Childcare over the Business Cycle

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  • Jessica H. Brown
  • Chris M. Herbst

Abstract

We estimate the impact of macroeconomic conditions on the childcare market. We find that the industry is substantially more exposed to the business cycle than other low-wage industries and responds more strongly to negative shocks than positive ones. Indeed, childcare employment requires more time to recover than the rest of the economy. Although the reduction in supply may pose difficulties for parents, we find evidence that center quality is countercyclical. When unemployment rates are higher, childcare workers have on average higher levels of education and experience, turnover rates are lower, and consumer reviews on Yelp are higher.

Suggested Citation

  • Jessica H. Brown & Chris M. Herbst, 2022. "Childcare over the Business Cycle," Journal of Labor Economics, University of Chicago Press, vol. 40(S1), pages 429-468.
    • Handle: RePEc:ucp:jlabec:doi:10.1086/718189
    DOI: 10.1086/718189
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    Cited by:

    1. Brown, Jessica H. & Herbst, Chris M., 2023. "Minimum Wage, Worker Quality, and Consumer Well-Being: Evidence from the Child Care Market," IZA Discussion Papers 16257, Institute of Labor Economics (IZA).
    2. Herbst, Chris M., 2022. "Child Care in the United States: Markets, Policy, and Evidence," IZA Discussion Papers 15547, Institute of Labor Economics (IZA).
    3. Chris M. Herbst, 2023. "Child Care In The United States: Markets, Policy, And Evidence," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 42(1), pages 255-304, January.
    4. Ali, Umair & Brown, Jessica H. & Herbst, Chris M., 2022. "Secure Communities as Immigration Enforcement: How Secure Is the Child Care Market?," IZA Discussion Papers 15821, Institute of Labor Economics (IZA).
    5. Herbst, Chris M., 2024. "The Declining Relative Quality of the Child Care Workforce," IZA Discussion Papers 17351, Institute of Labor Economics (IZA).
    6. Ali, Umair & Brown, Jessica H. & Herbst, Chris M., 2024. "Secure communities as immigration enforcement: How secure is the child care market?," Journal of Public Economics, Elsevier, vol. 233(C).

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