Supply is the number of child care slots offered by legally operated and state-recognized providers. BPC used this definition to ensure the analysis included the entire range of formal child care settings parents utilize. To build comprehensive datasets of each provider’s location and capacity, BPC worked directly with each state’s various child care and education agencies, as well as federal child care administrations. Each state’s child care supply data was only incorporated into the analysis once the state approved of the dataset. To continuously improve the analysis, the supply data is subject to change as BPC encourages states to continuously include additional facilities information that could make the dataset more complete. See the full report for a detailed explanation of the data collection process.

The number of children age five and under with all available parents in the labor force, according to the 2014-2018 American Community Survey five-year sample. BPC did not analyze the demand for child care: the rate at which families actually utilize or look for formal child care. While child care demand would have produced a better estimate of the amount of additional supply parents actually need, many seasonal and family-related factors influence demand and there is little data available on the demand for child care by geographic area. As a result, gap estimates from this analysis provide informative starting points from which officials can begin to make policy recommendations. But any recommendations must also consider data on how much and what types of child care communities will actually use.

Some communities place great value on caring for children within their families, rather than opting for formal child care. In these communities, potential need may be less likely to translate to actual demand. To identify the states in which potential need may have been more affected by greater preferences for family caregiving, look to the chart below for each state’s composition of children age five and under by parent labor force participation. Having a greater proportion of children with some parents not in the labor force compared to the national average, may indicate a greater emphasis on family caregiving. The figure also disaggregates by poverty categorization since poverty status likely constrains parents’ choices of whether to participate in the labor force or stay home.

The number of children who potentially need care but whose families cannot reasonably access formal care by driving. Each census block group—the census’s best available household location estimate—was assigned a service area of a specific driving radius. It was assumed that families with children five and under in a given block group could reasonably access the child care facilities within their service area. Thus, potential child care need within each block group was proportionally allocated to the child care providers within each service area until all provider capacity was filled. Urban block groups were assigned service areas with a 3.5-mile driving radius, while rural block groups were assigned service areas with a 10-mile radius to reflect the distances parents in those communities are willing to drive. This methodology enabled BPC to quantify the number of children without access to child care by location. See the report for a detailed explanation of the methodological decisions made in this analysis.

The economic burden of America’s child care gaps on households, businesses, and tax revenues. The annual impact indicates the immediate one-year impact of these gaps on the economy. The future impact represents the annual value plus losses that accumulate over the next 10 years due to the compounding nature of deficits incurred in that initial year. The future impact does not include new economic losses from gaps existing in future years. BPC calculated both high and low estimates of the impact, providing policymakers a range of what the economic impact might be when using more and less conservative assumptions. See BPC's economic impact report for a detailed discussion of these assumptions. The three components of the analysis capture:

1. -Household Impacts: income losses parents incur from having to reduce their work hours or leave the labor force entirely, as well as future lost earnings from delayed opportunities for promotions, reduced work experience, and reentering the workforce at a lower station.
2. -Business Impacts: direct productivity losses such as hours of foregone worker productivity and continual pay and benefits paid to employees when they are not working, as well as future lost earnings from turnover costs and the delayed ability to capitalize on growth opportunities.
3. -Tax Revenue Impacts: the proportion of lost household and business income that would have contributed to government revenues, as well as future lost tax revenues from future lost household and business earnings.