By Ethan Faverino |
Arizona’s childcare system is in crisis, with the number of licensed providers plummeting nearly 50% since 2002, while costs have skyrocketed beyond the reach of many working families, according to a new report from the Common Sense Institute (CSI).
The state’s licensed childcare providers have fallen from 5,126 in 2002 to just 2,779 in 2024—a 46% decline that has driven up prices, lengthened waitlists, and left hundreds to thousands of Arizona children without access to formal care.
The report, Childcare in Arizona: An Economic Opportunity with Wide Implications, warns that without urgent policy action, the shortage will continue to push parents—predominantly mothers—out of the workforce and widen economic disparities across urban and rural communities.
Currently, Arizona ranks 6th in the country for infant care costs relative to median income. The state is behind California, Vermont, Washington, Washington, D.C., and Massachusetts.
Licensed facilities have dropped from 4,660 in 2010 to 2,687 in 2022 before a modest rebound to 2,779 in 2024, with closures accelerating to 9.2% annually between 2018 and 2022 due to COVID-era restrictions, labor shortages, and rising regulatory costs.
Arizona has only 256,267 licensed slots for 460,882 children under age 6. Rural counties like Santa Cruz barely have enough licensed capacity to support 1% of the infant population in the county.
“Even as demand remains high, the number of licensed providers has fallen sharply — limiting supply, driving up costs, and constraining labor force participation,” said Glenn Farley, Director of Policy and Research at CSI. “These pressures ripple through the broader economy, reducing productivity and household income. Based on our analysis, expanding access to affordable, quality care is not only good policy, but a necessary step for sustaining long-term economic growth in the state.”
The median daily cost of infant care now stands at $61.40, a 42.7% increase from $43.03 in 2018, requiring a minimum-wage worker to labor 72.8 hours per month just to afford one infant’s care.
Urban counties like Maricopa and Pima fare better than rural areas, yet shortages remain acute. In Maricopa County, infant slot coverage reaches 13%, and families need 37.6 hours at the average wage to afford care.
Childcare workers earn just $13.67 per hour—57 cents for every dollar the average Arizona worker makes, and per-capita employment in the sector has fallen from 1.5 to 0.8 workers per 1,000 residents since its peak.
CSI estimates that closing the childcare gap could bring 50,000 jobs into the workforce, boosting Arizona’s GDP by up to $17.5 billion and generating $188 million in new income tax revenue under a midpoint scenario.
“Costly, scarce childcare sidelines too many parents,” the report concludes. “Make it more available and affordable, and Arizona wins—more people working, higher incomes, and more state revenue.”
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
