One Tool Among Many: Child Care Subsidies in Low‑Income Family Financing

• In Event: Examining the Complexities of ECE Funding from a National-, State-, Program- & Family-Level Perspective

Abstract

Introduction. The Child Care and Development Block Grant (CCDBG) is a key financing mechanism within the U.S. social safety net. Evidence indicates positive associations between subsidy receipt and employment and income, yet evidence remains mixed for parent stress and satisfaction with child care (e.g., Ha and Miller 2015; Schochet and Johnson 2019, Healy and Dunifon 2014). When examining these impacts, most researchers compared recipients to non‑recipients, obscuring meaningful variation among eligible families. This distinction is consequential: not all eligible or approved families successfully use subsidies. As a result, standard evaluations may understate or mischaracterize the impacts associated with CCDBG funds. It is also important to contextualize CCDBG impacts within the broader set of safety nets that families use.
Purpose. We examined how child care subsidies operate as a financing tool for low-income families, with particular attention to subsidy use and contextualization with families’ use of other public safety net programs. We asked: How does using a child care subsidy affect families’ ability to afford child care and other household expenses as well as influence family stress and satisfaction with child care arrangements? How do child care subsidies fit within families’ broader portfolios of public supports, such as nutrition and health insurance?
Research Design and Methods. We used a mixed‑methods, statewide study design. We sampled families who received a child care subsidy between November 2024 and July 2025, stratified by administratively defined priority populations, and recruited additional families who applied for but did not receive a subsidy and those who were eligible but never applied. Families completed a survey (N = 2,239), with a subset participating in interviews or focus groups (N = ). We compared outcomes across families with no subsidy, families who were approved for but did not use a subsidy, and families who used a subsidy to pay for child care. This distinction allows us to isolate the role of subsidy use in shaping outcomes. We analyzed outcomes such as parental employment, economic well-being, stress, and satisfaction with care. We descriptively assessed families participation in other public programs, including SNAP, WIC, Medicaid or CHIP, Head Start, and public preschool.
Preliminary Findings. More families that used subsidies reported being able to pay for necessities and discretionary expenses, feeling less stressed, and higher satisfaction with their children’s child care than families that did not have or did not use subsidies. Descriptive analyses indicate that most families using child care subsidies simultaneously relied on other safety net programs, underscoring the role of subsidies as one component of a broader financing strategy rather than a standalone intervention. We will also share what we learned about whether families reported using public preschool and/or Head Start.
Implications. These findings highlight the importance of viewing child care subsidies as part of an integrated system of supports. From a policy perspective, the results underscore how administrative design, benefit coordination, and subsidy use shape the effectiveness of child care financing in promoting economic stability and reducing family stress.

Author

• Gina C Adams, Urban Institute
  Presenting Author