The Biden administration looks to expanded child care funds to combat labor shortages.

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The Biden administration is trying to build support for proposals to overhaul the country’s dire child care system as it pushes Congress to adopt a $3.5 trillion plan to expand Social Security programs and the ongoing labor Finds ways to deal with shortages.

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In a new report released on WednesdayThe Treasury Department painted a dire picture of child care in the US, underlining what it called a failure by the private sector to provide high-quality care at affordable prices and making the case that the federal government should not be allowed to protect its children. More should be done to help families take care of themselves.

“This is not just one phenomenon – sound economic principles explain why relying on private funding for child care is less common,” the report said.


The Biden administration has already disbursed nearly $40 billion to help child care providers and day care centers through the funds approved in the US Rescue Plan, which Congress passed earlier this year. The Treasury Department is also distributing monthly advance Child Tax Credit payments to families with children.

Vice President Kamala Harris will visit the Treasury Department on Wednesday afternoon Make the case for more child care funding.

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Mr. Biden’s plan includes child care subsidies for low- and middle-income families, universal preschools for 3 and 4 year olds, and a permanent extension of the child and dependent care tax credits.

The Treasury report argues that families are currently spending about 13 percent of their income to pay for the cost of child care for a child under the age of 5. Despite the high cost, child care providers are poorly compensated.

The patchwork nature of child care systems often gives parents incentives to leave the labor force, losing access to health insurance and retirement benefits. The United States is currently grappling with a labor shortage, and the Biden administration promotes access to child care as a way to get people back to work.

“From a fundamental economic point of view, the president’s proposals will expand both the demand and supply of child care,” the report said. “With expanded demand, more children will have access to rich early experiences and more parents will be able to choose to remain in the labor force.”

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