How Funders/Investors Help FCF Close the Child Care Funding Gap 

First Children’s Finance (FCF) knows that access to affordable, high-quality child care is essential for working families and ultimately strengthens and stabilizes our communities and the economy.

When parents have access to reliable care, they can fully participate in the workforce, pursue education, and support their families. When children are in safe, nurturing environments, they develop the skills they need to thrive. And when child care providers are supported, the entire system becomes more sustainable and resilient.

FCF works at the intersection of these needs: supporting providers, advising policymakers, and strengthening the business side of child care.

Investing in child care is an investment in families, in local economies, and in the long-term health and prosperity of our communities. There is a deep and persistent disconnect between the essential nature of child care and the way it is financed. Families are often expected to cover costs that are unaffordable, while providers struggle to keep their doors open on razor-thin margins. Meanwhile, public investment falls far short of what is needed to build a system that is accessible, high-quality, and sustainable.

This disconnect creates a fragile and inequitable child care landscape where too many parents are forced to make impossible choices, too many providers face burnout and closure, and too many communities are left without the infrastructure they need to grow and thrive.

At a federal level – and especially within individual states – investing in child care yields substantial returns. Without access to affordable, reliable child care, parents (most often mothers) are forced to reduce work hours, leave jobs, or turn down career opportunities. These disruptions come at a cost to both individual households and the broader economy.

FCF’s work helps prevent those disruptions by building stronger business models, financing child care facilities, and partnering with communities to expand access to quality care

In addition, child care investments help stabilize and grow small businesses, particularly family child care homes and centers, of which are most often run by women. With the right support such as grants, technical assistance, and facilities funding, these providers can thrive, expanding access and improving quality of care.

FCF and Its Funders/Investors Help Fill the Gaps

Many corporate foundations have prioritized child care in their grantmaking strategies. In Minnesota, funders such as PNC and the W.K. Kellogg Foundation have supported initiatives that include FCF programming across the state.

In Michigan, JPMC supports FCF initiatives to serve licensed child care businesses operating in Detroit with comprehensive business development resources that strengthen, stabilize, and grow their capacity to serve more children and achieve financial sustainability. These investments have enabled FCF to address large-scale community supply needs while developing tailored, community-based services and solutions.

Thanks to this support, FCF has achieved the following in these states:

• Minnesota: FCF helped create 1,734 new child care slots and preserve 8,551 existing slots statewide.
• Minnesota: FCF’s efforts have supported the creation of 269 new child care jobs and helped preserve 1,527 existing jobs across the state.
• Michigan: JPMC funding has led to FCF working with 40 child care providers in Detroit in year one. These providers have participated in a variety of services, some engaging in multiple ways. We provided technical assistance to 19 child care businesses and in-depth consulting to one child care.  Eight training sessions have been completed—four Detroit-specific workshops reaching 17 participants and four statewide trainings that included 26 additional Detroit-based participants. Two Business Leadership Cohorts have been completed – one for home-based child care and one for centers- engaging eight Detroit providers in intensive, multi-session programming. Participants report gaining new insights, making operational changes, and improving their financial sustainability as a result of FCF’s support.

These outcomes reflect the meaningful impact of our work in expanding access to quality care, filling the gaps where state funding falls short.

What States Are Leading the Charge in Child Care?

When states make significant investments in child care, one of the most immediate outcomes is increased workforce participation, particularly among women. When affordable, reliable care is available, more parents are able to enter and stay in the workforce, contributing to household stability and the broader economy. In fact, child care itself is a powerful economic driver, creating jobs and enabling others to work. Research shows investment in child care can deliver a return of more than 13 percent – far outpacing many traditional community investment opportunities.

The cost of child care varies wildly depending on where you are in the country, from around $6,868 annually if you’re in Mississippi, to $28,356 in the District of Columbia (DC). Many families who make the median income in their states cannot afford to send their infant or toddler to child care. In some states, child care costs can take up to 18% of their family’s income. In 28 U.S. states, the annual cost of child care exceeds the cost of college tuition. In Florida, for example, center-based infant care costs about $9,238 per year and public college tuition and fees cost about $4,455 per year. In Washington, D.C., infant care is $24,243 annually, more than four times the annual cost of college tuition.

According to Child Care Aware of America’s 2025 report, the average state funding for child care or preschool is about $1,300 per child. However, some stand out:

• Massachusetts leads with approximately $4,600 per child in state-directed funding.
• District of Columbia, though not a state, is an outlier, investing over $8,000 per child.
• Conversely, states like Idaho, Indiana, Nevada, Ohio, Wisconsin, and Wyoming invest only the federal minimum and don’t add state-level funds.

As more states and funders recognize the economic and social returns of investing in child care, momentum is growing for lasting change. But meaningful transformation requires bold, sustained action. It means treating child care not as a private burden, but as a public priority that deserves robust funding, thoughtful policy, and coordinated support. At First Children’s Finance, we remain committed to working alongside providers, policymakers, and communities to build a child care system that is accessible, high-quality, and built to last. When we invest in child care, we invest in a stronger future for everyone.

Want to know how you can help FCF bridge the child care gap? Contact us at media@firstchildrensfinance.org.