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Fewer Michigan child care centers closing down in the last year with help of federal funding

More financial aid being invested in day cares
Total childcare centers and in-home family day cares in Michigan from April 2020 to April 2022
Posted at 6:17 AM, May 26, 2022

VICKSBURG, Mich. — With the help of state and federal funding, fewer and fewer day care and child care centers are closing their doors in Michigan, providing some good news for parents still desperately looking for places to leave their kids as they head to work.

Last year we reported that child care centers were quickly closing their doors. The reason? Not enough staff, worries about COVID-19 and financial strain.

Now, in 2022 we're seeing a different trend and it's thanks to some additional financial support these centers are seeing.

Financial aid helping keep Michigan childcare centers open

In 2021 Andrea Allen, owner of Annie A's Childcare in Vicksburg, was stressed, overwhelmed and overworked.

“There was a lot of stress during COVID. There really was," she said.

Allen even considered retiring early and leaving the profession she loves most.

“It is difficult. It is," she said.

Unfortunately, Allen isn't alone. According to the Michigan Department of Licensing and Regulatory Affairs, from April 2020 to April 2021, 315 in-home family day cares in Michigan closed their doors, and 55 day care centers did the same.

Child care centers and in-home family day cares in Michigan April 2020 to April 2021

“If we don't have childcare we can't go to work, we can't do the things that we need to do," Southwest Childcare Resources Center director April Goodwin said.

Goodwin helps provide aid and resources to day care owners in West Michigan through her program.She says it's a trickle-down effect - if childcare centers close, parents can't go to work and employers can't find employees. She says what's changed this year is the amount of financial help now available to these providers, incentivising them to stay in business. And that's good news for everyone involved as some parents are still struggling to find day care.

“Because we have the Stabilization Grants going, that's doing a lot. I can see right now that the state is doing so much more to try to benefit and help our childcare providers," Goodwin said.

The Stabilization Grant is over $700 million dollars in federal COVID relief funding to help Michigan childcare centers stay open.

“It's helping with operational costs such as salary and wages, rent, utilities, materials and supplies for children that support reducing the risk of COVID," Michigan Department of Education child development and care director Lisa Brewer-Walraven said.

The financial investment seems to be working and owners now have the ability to give raises, hire more staff and update their buildings.

“They gave out the Stabilization Grant and that was huge in determining for me to stay because I was on the fence," Allen said.

Looking at the last year, from April 2021 to April 2022, 233 in-home family home day cares closed in Michigan and even though that's a significant number, it's still about 100 centers less than closed between 2020 and 2021. As for day care centers, 19 additional locations actually opened their doors across the state from April 2021 to April of this year.

Total childcare centers and in-home family day cares in Michigan from April 2020 to April 2022

“We're pleased that the numbers are continuing to go up and that we have individuals who are willing to step into the field and take on that incredible responsibility as a business owner serving children and families in their communities," Brewer-Walraven said.

The first round of grants was distributed in January of 2022, with 5,890 grants totaling a little over $365 million, leaving over $300 million to be distributed in the second round of grants.

Another financial incentive to help childcare workers that was announced last week is the "Caring for MI Future' initiative.This is even more federal funding, this time $100 million from the American Rescue Plan to increase the number of childcare providers in Michigan over a two-year period. The goal is to add 500 new providers each year until 2024.

“So that $100 million investment is going to help providers with space with startup funding if they're interested in joining the field, helping with some of the staff barriers that they're experiencing and offering them support for their business," Brewer-Walraven said.

The deadline to apply for the second round of Stabilization Grants is May 26th at 6 p.m.