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The cost of child care is pushing working mothers out of the workforce. Fewer than one-third of parents say their employer helps with the cost of care. In many states, care for two children costs more than rent or a mortgage. For low-income families, it’s often an impossible choice: go to work just to hand over the paycheck to a child care center, or step out of the labor force entirely.
That’s why child care subsidies matter. Andrew Garin, assistant professor of economics at Carnegie Mellon University’s Heinz College, says: “Child care subsidies can meaningfully increase female employment, particularly in low-income families.” Research backs him up: subsidies build long-term security for families, reduce reliance on social assistance and fuel stronger local economies. Under a broad subsidy expansion, full-time maternal employment would rise by nearly 10 percentage points.
The federal Child Care and Development Fund (CCDF) is the government’s main source of subsidy funding. Children must live with families whose income does not exceed 85% of their state’s median income for a family of the same size to qualify. In 2019, about 1.4 million children and 857,700 families per month received child care assistance. Yet in 2023, fewer than 15% of eligible families actually received subsidies. In other words, the support exists but is out of reach for most of the families who need it.
A Union-Led Solution
Some unions and famtech companies are closing the gap. The United Federation of Teachers (UFT) partnered with benefits platform Mirza to launch NYC Childcare Navigator, a tool that helps paraprofessionals (teacher assistants) identify all available child care subsidies in under five minutes, apply for them through a single process and find real-time openings at local providers.
The union prioritized access because teacher assistants are among the lowest-paid New York City public school employees, and too many were leaving the profession. “We developed NYC Childcare Navigator to help address an infuriating reality. Educators were unable to find and access child care for their own children,” says Michael Mulgrew, president of the UFT. UFT also partnered with Upfront, a software company that maintains real-time listings of providers who accept subsidies and have openings. According to Mirza CEO Siran Cao, the company cut a process that used to take months down to under 30 minutes.
Child care subsidies have long existed, but many eligible families never received them because of complex applications, scattered information and low awareness. What’s new is the technology. Platforms like Mirza and Upfront collapse multiple forms and searches into a single streamlined process. Just as fintech revolutionized banking access, famtech is beginning to modernize the child care safety net, turning an underused benefit into a lifeline at scale.
Results In New York
The results in New York are promising. NYC Childcare Navigator has already connected more than 2,000 members to government-funded resources, with users qualifying for an average of 2.5 programs each. “More than 40% of users surveyed reported being able to work more and increase household income after accessing benefits. In half of those households, a parent returned to work,” says Mulgrew.
Childcare Navigator is also a replicable policy blueprint. Imagine if rideshare companies, warehouse employers or state governments embedded similar tools: millions of low-wage and nontraditional workers could instantly access child care subsidies. Research from NBER suggests such models could raise maternal labor force participation by roughly 6 percentage points, bringing more than 1 million mothers back into the workforce and generating billions in household income gains.
Child care subsidies exist in every state, but their impact depends on whether families can actually use them. NYC Childcare Navigator proves that technology can close the access gap and turn public dollars into measurable workforce gains. When we cut red tape, families qualify for more programs, parents re-enter the workforce and local economies grow stronger. Child care is workforce infrastructure. When we make it easy to find and afford, parents go back to work and the economy wins.