How COVID-19 Relief for the Care Economy Fell Short in 2020 – Next100
Commentary   Education & Early Years

How COVID-19 Relief for the Care Economy Fell Short in 2020

The pandemic made the cracks in the care economy more evident than ever. Congress responded to care needs in its COVID-19 relief packages, but these efforts were far from enough.

The pandemic has reminded us all just how interconnected—and interdependent—we are. As the coronavirus that causes COVID-19 spread from person to person, and from community to community, it wreaked havoc on our daily routines and laid bare the relationships and services we all rely on to get by—particularly those provided through the care economy. As the pandemic raged on, parts of the care economy were shut down temporarily or for good, while others were strained to the breaking point. Millions of families with children saw their schools and child care centers close, depriving workers of the care they needed; meanwhile, child caregivers and early educators who were still employed scrambled to stay open and provide services during a pandemic. Seniors and people with disabilities—and the family caregivers, home health care workers, nursing home staff, and personal care attendants that care for them—experienced unfathomable challenges as the coronavirus tore through these communities.

The disruption in our lives and in our economy caused by the COVID-19 pandemic demonstrated the horrific results of our country’s failure to invest in a robust care infrastructure. A robust care infrastructure is a publicly funded system that recognizes care as not only an individual responsibility but a social one as well, values care workers, and supports family members to care and provide financially for each other. It looks something like what President Biden laid out in his campaign and again in his Build Back Better plan, announced January 14. The Biden proposal includes investments in a caregiving economy that support the range of care needs, from child care and early education to care for aging adults and people with disabilities. The Biden plan includes expanding access to long-term services and supports, ensuring access to high-quality, affordable child care, and investing in the caregiver workforce by improving pay and benefits. These investments are not only critical to a racially just and gender equitable economic recovery that addresses systemic ageism and ableism, but also key to building a pathway forward that is sustainable for all families. It will accrue benefits to our entire society and economy.

In building up its caregiving economy, the United States will be starting from a significant deficit, after decades and decades of underinvestment. Black, Latinx, and Indigenous women in particular—all of whom have long faced intersecting oppressions—are feeling the multiple effects of being more likely to have lost their jobs, being on the front lines as essential workers, and solving their care challenges on their own. December’s job report showed that nearly 100 percent of the job loss was Black and Latinx women. And an October report by The Century Foundation and the Center for American Progress shows that the United States is at risk of losing an estimated $64.5 billion in economic activity from women’s aggregate lost wages due to the lack of child care and their need to reduce hours or leave the workforce.

This commentary looks at what Congress was able to do in 2020 in its COVID-19 relief bills to address the needs of an underfunded, turbulent, and collapsing care economy and examines where gaps in policy support remain across five key areas: child care and early education; paid leave; long-term services and supports; the care and attendant workforce; and family caregivers. It then proposes a plan for moving forward.

Child Care and Early Education

The Need: Before the pandemic unfolded, families across the country were already facing out-of-reach child care costs, child care deserts, and inhospitable workplace policies. Many early educators faced low wages that forced them to work multiple jobs or rely on public assistance programs—and these inequities disproportionately impacted women of color. And once the pandemic began, school, camp, and child care closures—and the increased costs of continued operations for those programs which were able to remain open—further exposed the vulnerabilities of the child care and early education sector.

In November, a study by the National Association for the Education of Young Children (NAEYC) found that many child care and early education programs have closed. The majority of those that are still open have increased costs that are causing them to lose money every day they stay open. Increased costs are unavoidable in the midst of the pandemic, caused by the need to provide protective and cleaning equipment, and facility upgrades to ensure safe ventilation, and these increased costs are occurring alongside reduced enrollment due to the need for smaller classes and parent fears of sending their children into group settings. In short, many programs are simply being asked to do more with less, with the result that many child care providers are accruing debt for their programs on their personal credit cards and/or being forced into furloughs, pay cuts, and layoffs. The child care sector lost more than 350,000 jobs in a single month at the beginning of the pandemic, and half of those jobs have not yet returned. Recent data show that on a monthly basis, the sector has barely added any jobs, and may have lost even more in December. Meanwhile, parents—especially mothers—are leaving their jobs or reducing their hours to cover the time when their children used to be in child care or school.

The 2020 Federal Response: Overall, the federal relief packages included a total of $13.5 billion in additional funding for the Child Care Development Block Grant to help stabilize the child care sector. Congress included $3.5 billion in the CARES Act and $10 billion in the Consolidated Appropriations Act. The funds are provided to states, territories, and tribes to support families by covering the costs of providing relief from copayments and tuition payments for families. The relief package supports child care providers by covering the costs of decreased enrollment or closures related to coronavirus and to help providers to remain open or reopen as appropriate and applicable (including for fixed costs and increased operating expenses). In addition, funds can support child care staff and early educators by paying their salaries and wages. The funds are available to center-based child care providers, family child care providers, and home-based child care providers and can also be used to provide technical assistance to help child care providers implement health and safety provisions.

States have utilized the inherent flexibility of the COVID-19 relief funds to address specific community needs pertaining to child care. In New Mexico, in addition to waiving parent copayments, the state utilized over a quarter of the CARES Act funds on staff incentive pay—full time staff were eligible for $700 each month, while part-time staff were eligible for $350 each month. California also covered copayments, while New York expanded copayment waiver eligibility. Georgia used CARES Act funding to set up a program to pay for staff salaries and benefits, including substitutes, tuition relief, cleaning supplies, classroom materials and supplies. Minnesota used funds to subsidize providers for children who were absent at open facilities and providers who had temporarily closed.

In addition, the CARES Act included $20 billion in state fiscal stabilization funds (which governors can distribute among early learning programs), and $750 million in Head Start funding. It also included small business loans for which many child care programs were eligible, but according to a Bipartisan Policy Center analysis, fewer than 6 percent of the more than 670,000 child care businesses received a Paycheck Protection Program loan.

Paid Leave

The Need: Before the COVID-19 pandemic erupted, the need in the United States for paid sick days and paid family and medical leave was so great that fifty-three states and localities passed paid sick days laws and ten states passed paid family and medical leave laws. These laws ensure that people can take the time they need for their health without sacrificing their financial security and wellbeing. They allow people to stay home confidently when they are sick or concerned about possible contagion. And they support parents caring for newborns and newly adopted children, family members caring for each other, and in some cases the ability to care for people who are like family, but aren’t “officially” so. Yet, millions of people who do not live in these states and localities remain without either type of paid leave, and, not surprisingly, those already struggling to make ends meet are also the least likely to receive these protections.

When the pandemic hit, the need for paid sick days and paid family and medical leave policies became even more evident, and more important. Stopping the spread of a global pandemic requires staying home if possible—and paid sick days make it much easier and even encourage people to do that. In addition, quarantine requirements and school and child care closings meant parents needed to be home with their children without worrying about their financial security. And, individuals getting sick with COVID-19 and needing time to recover, or experiencing long-haul impacts and needing extended leave from their jobs, made paid leave for serious illnesses a necessity.

The 2020 Federal Response: The Families First Response Act (H.R. 6201, or the FFCRA), signed into law on March 18, 2020, took the critical first step of guaranteeing two workweeks of emergency paid sick leave and ten workweeks of emergency paid family leave to people working in businesses with fewer than 500 employees for many pandemic-related purposes, such as quarantines and recovering from the virus. The policy provided two weeks (up to eighty hours) of paid sick leave at the employee’s regular rate of pay when the employee was unable to work because of quarantine and/or they were experiencing COVID-19 symptoms and seeking a medical diagnosis. It provided a lower wage replacement level for family caregiving needs—ensuring two weeks of paid sick leave at two-thirds the regular rate of pay to care for a family member in the same situation as described above or to care for a child whose school or place of care was closed, or whose child care provider was unavailable because of COVID-19. This child care provision was extended for up to an additional ten weeks of paid expanded family and medical leave at two-thirds the employee’s regular rate of pay.

In addition, the FFCRA included tax provisions for businesses providing paid leave and those who are self-employed. The provisions reimbursed eligible employers for 100 percent paid leave, which included the regular rate of pay for paid sick days up to $511 per day for up to ten days; and two-thirds of regular pay for family care and child care leave up to $200 per day up to ten days for family care and ten weeks for additional child care. The CARES Act amended these provisions, allowing employers and self-employed individuals to receive an advance tax credit from the U.S. Treasury for the cost of providing emergency paid sick days and paid leave instead of having to wait to be reimbursed.

Importantly, the FFCRA’s provisions also left room to exclude up to 106 million workers from emergency paid leave. From people working for business with more than 500 employees to those whose employers are allowed to exempt them because they work as health care providers or emergency responders or in businesses with fewer than fifty employees, many individuals who need the paid time to care did not receive it. In addition, by limiting the family care benefit to two-thirds of regular wages and limiting paid family and medical leave to child care, the policy was grossly inadequate for supporting family caregivers.

For those that were included and able to use it, the results were clear. A study published in Health Affairs found that emergency paid sick days helped flatten the curve in the United States. Yet, Congress allowed these provisions to expire at the end of 2020 rather than extend them.

Long-Term Services and Supports

The Need: Half of all adults turning age 65 today will need long-term services and supports (LTSS), and about two in five people who need LTSS today are under 65 years old—including many people with disabilities—and many may require the support over their lifetimes. Today, the inadequacy of public policies leaves the responsibility of providing LTSS to family and friends, and when it is paid work, families primarily pay out of pocket or rely on the Medicaid program. Meanwhile, the support that does exist is biased toward institutional care, not supporting independent living or aging with dignity in homes and communities. The government’s divestment from its responsibility to provide this public good and better access to home-and community based services has major financial, health, and well-being costs to older adults, people with disabilities, and the family and friends who support them. These factors all made COVID-19 a complete disaster for millions. In fact, 40 percent of COVID-19 related deaths have been linked to residents and staff at nursing homes and other long term care facilities.

The 2020 Federal Response: Despite their vulnerability to the pandemic, the COVID-19 response packages mostly left older Americans, people with disabilities, and those living and working in congregate care settings behind. Nursing homes received $2 billion through the Nursing Home Quality Incentive program in the Provider Relief Fund in the CARES Act. Unfortunately, without accountability, transparency, or reporting requirements, experts fear that some of this money has gone to help pad for-profit operations’ bottom lines rather than patient and staff health and safety. In particular, too little of these funds were used to support the nursing home staff whose low wages contribute to turnover and made it particularly unappealing to maintain risky work in poor conditions; neither were the funds used to address staffing shortages. Congress also increased federal funding to states to help cover the rising costs of Medicaid through an increase in the federal Medicaid match rate (FMAP), but specifically did not authorize these funds to be used for home health care. While the increased federal funding will help state budgets, it is not targeted at home and community-based services, and states can still cut these services as they face budget shortfalls as a result of the economic crisis. In addition, Congress extended for three years the Money Follows the Person program, which supports transitioning people out of congregate care into their communities. It also extended the spousal impoverishment protections for married individuals receiving home and community-based services (HCBS). Yet, home- and community-based services received no additional resources—for protective equipment, staffing, wages, or anything else needed—even as families aimed to bring their aging and disabled loved ones home from these dangerous congregate care settings. As noted above, even the emergency paid family and medical leave provisions excluded care needs for anyone but children.

The Care and Attendant Workforce

The Need: Good care policies should include support for consumers of care and those providing the care—including both paid and unpaid caregivers. Not only is that the right thing to do, but also investing in the people providing care leads to better quality of care. Yet, today’s insufficient care policies mean that people working in child care, nursing homes, and other congregate care settings, as well as working in home care and as personal attendants often live in poverty—receiving hourly wages ranging from $10.72 for child care workers in all settings to $11.89 for non-agency home care workers, frequently without health insurance, retirement security, or other benefits. People who work in these sectors are disproportionately Black, Latinx, and immigrant women who also face multiple oppressions, poor working conditions, and insufficient legal rights and protections. The COVID-19 pandemic has had a disproportionate impact on this workforce—either designating them to be “essential workers” and requiring them to risk their own and their families’ health for low wages and limited benefits, or completely forcing them out of the workforce.

The 2020 Federal Response: While there was no specific care worker response in the COVID-19 packages, the Pandemic Unemployment Assistance (PUA) and Pandemic Unemployment Compensation (PUC) helped those care workers who were let go as a result of COVID-19 closures or economic distress. In particular, PUA provided unemployment assistance to workers who are not included in or have exhausted regular state UI benefits. PUA provides up to thirty-nine weeks of immediately available unemployment insurance (UI) coverage through December 31, 2020. Many self-employed workers, independent contractors, freelancers, workers seeking part-time work, and workers who don’t have a long-enough work history to qualify for state UI benefits were also eligible for PUA.

In addition, the child care stabilization funding allowed child care providers to continue to pay wages and salaries, and pay for health and safety expenses. Some states specifically invested in raising compensation through hazard or incentive pay. The nursing home relief funds in the CARES Act could also be used for raising wages of nursing home staff, providing protective equipment, and other staff-related needs, but as noted above, there is no public record of how much of it was used in those ways.

Funding for vaccine distribution will help care workers, as will nutrition assistance and the eviction moratorium. Additionally, the suspension of student loan payments in the COVID-19 relief packages addresses the economic crunch that many caretakers have been subject to. Some immigrant workers—who were excluded from the earlier relief bills—will receive $600 in cash assistance if they qualify under the most recent relief bill passed.

Family Caregivers

The Need: Family caregivers range from parents caring for children, to grandparents caring for grandchildren, to people caring for their aging parents or spouses, and those providing services and support to their loved ones with disabilities. Often, care for children is considered separately from supports for people with disabilities and aging adults, but the issues are all interconnected, and an estimated 28 percent of caregivers are now in the “sandwich generation”—caring both for their children and for their aging parents. More than 44 million Americans across generations and caregiving needs provide unpaid support and care in this way, amounting to nearly $500 billion in opportunity cost, including lost wages, each year. As COVID-19 dumped an avalanche of responsibility on family caregivers’ shoulders, the long-standing “do it yourself” (DIY) approach to caregiving without significant comprehensive federal support became even more untenable. Family caregivers found themselves sinking—unable to meet the growing responsibilities of caregiving, let alone caregiving and working. The financial, health (including mental health), and well-being consequences are significant.

The 2020 Federal Response: Beyond the general support for child care stabilization and nursing home relief, the emergency paid sick days support for individuals needing care, and the emergency paid family and medical leave support for parents, the relief packages included no additional direct support for family caregivers. The HEROES Act that passed the House but not the Senate included $850 million for family caregivers through the Social Services Block Grant (SSBG), but that did not become law.

The Path Forward to Relief and Recovery

The United States has a harmful history and tradition of underfunding and undervaluing caregiving and the care profession. In order to address the systemic gender discrimination, systemic racism, and systemic ableism and ageism that is intrensic in the undervaluing of caregiving and the care profession, policy makers must recognize and address the biases that allow these inequities to persist.

It’s time to invest in relief and recovery, starting with the Biden–Harris plan to invest $40 billion in child care; extend and fix all of the exclusions in the emergency paid leave policy; raise the minimum wage to $15 per hour and provide hazard pay for essential workers. Immediate investments in home and community-based services and providers, and extending the FMAP increase will also be key. Then, policy makers must build back better, with (1) comprehensive “child care and early learning for all,” building on the Child Care for Working Families Act and the Universal Child Care and Early Learning Act which would guarantee families child care assistance and invest in the early education and child care workforce; (2) permanent paid family and medical leave and paid sick days policies; (3) a new, universal long-term services and supports investment that prioritizes home and community-based services; (4) better wages and working conditions for the care and personal attendant workforce; (5) significant supports for family caregivers; and (6) the Domestic Workers Bill of Rights. These policies will help overcome systemic biases, support economic recovery and growth and ultimately benefit all workers.

To paraphrase Hubert Humphrey, the moral test of government is how it treats those in the dawn of life, the twilight of life, and the shadows of life. When compared to how, during the pandemic, the government treated those in the prime of their lives—corporations and wealthy families—much of what happened in 2020 was close to a failure. Yet, with the new administration and Congress, and leaders who understand care issues firsthand represented throughout the government, 2021 is already looking more promising.

The authors would like to thank Nicole Jorwic and Bethany Lilly from the Arc for their feedback.

header photo: A first grader draws during recess at Stark Elementary School in Stamford, Connecticut. Source: John MooreGetty Images

About the Authors

Levi Bohanan Education & Early Years

Levi is an advocate for progressive child care policy and high-quality early education. Levi previously served in the Obama administration at the U.S. Department of Education, and has worked in the U.S. House of Representatives and with education nonprofits. At Next100, Levi’s work focuses on expanding access to high-quality child care and early childhood development opportunities.

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Julie Kashen

Julie Kashen is a senior fellow and director for women’s economic justice at The Century Foundation, with expertise in work and family, caregiving, economic mobility, and labor.

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