Three- and 4-year-old students play while Michelle James, left, executive director of community action agency of western Connecticut, and Mini Santosh, child care director at Action Early Learning Center in Danbury, watch. “We bring people in, and we lose them,” Sanotosh said of her staff. “They would hate to stay in industry, go to school, and then they’re looking at what does my check look like five years from now? Not change.” YEHYUN KIM / CT MIRROR

Connecticut’s early child care and preschool industry has continued to shrink, leaving fewer slots open for young children and shutting many parents out of the workforce, according to a report released Tuesday.

The report from research and advocacy organization Connecticut Voices for Children outlines the state of early care and education for young kids in Connecticut, highlighting issues that have existed for some time.

The report offers policy recommendations for alleviating the strain on families.

“In truth, the current challenges the early care and education sector face existed before the pandemic,” said Emily Byrne, executive director at Connecticut Voices, on a Tuesday press call. “However, what’s changed is that we’re seeing a greater willingness to do something about it.”

The state’s child care system has been strained for years, but the COVID-19 pandemic highlighted many of the issues and the role of the child care sector in the economy.

Gov. Ned Lamont convened a “Blue Ribbon Panel” last year to develop a strategic plan to strengthen the child care system. The panel’s recommendations are similar to those outlined in the Connecticut Voices report.

Some of the report’s recommendations include expanding eligibility for Birth to Three services and ensuring that there is meaningful parent representation at the policymaking table when decisions are made about the system.

Access to early care and education helps close achievement gaps for kids, especially those from low income families and immigrant families, children of color, children experiencing homelessness and kids with special needs. Children who have high-quality care from infancy to preschool are more likely to form good relationships with their peers and do better in school.

“Our ultimate aim with this report and all of our early care and education work is for systems change, changes that ensure every parent that needs early care and education doesn’t have to break the bank to pay for it, every educator that chooses the sector of the profession is compensated fairly with dignified wages, and every child receiving early care and education is provided a high quality opportunity so that she may endeavor to succeed later in life,” Byrne said.

Statewide data show that the number of publicly funded slots for infant and toddler care dropped by 3,490 — about 17% — from 2022 to 2023. The state has 49,898 preschool slots, a 4% reduction from 2022 and the lowest number since at least 2005, the report says.

Part of the decline in the number of available slots is because of a reduction in the number of places that offer child care. Connecticut had 1,817 family child care homes in 2023, a 34% reduction since 2010. The state also reported 1,374 child care centers, a 13% drop since 2010, according to the report.

Family child care homes are private homes that offer care for up to six children who are not in school full-time. Child care centers are typically larger — up to 12 children outside of their own homes one or more days per week.

The pandemic put more pressure on the child care system. Many providers closed when people stayed home, and others weren’t able to stay open after revenue loss during the pandemic.

The state stepped in with grants and an increase in the child care payment rates, but the Connecticut Voices report says inflation and a higher minimum wage meant that the increased funding didn’t have as much of an impact for providers.

Strains on the child care system exacerbated by the pandemic have been an issue nationwide for many of the same reasons as in Connecticut. When families can’t access or afford child care, it can shut parents out of the workforce.

In Connecticut, child care costs on average $18,156 for center-based care and $11,955 in a family child care home annually. This means Connecticut has the third-most expensive early care costs, behind only Washington, D.C. and Massachusetts, according to the report.

In addition to the high cost to families, the workers — many of whom are women — often earn low wages, the report says.

“While the financial burden on parents is too heavy for many families to manage, ECE providers in Connecticut struggle to operate businesses that often must survive on less than one percent profit margins,” the Connecticut Voices report says.

Children of color, immigrant children, children experiencing homelessness and children with special needs are the least likely to have high-quality child care, according to the report.

The number of children in Connecticut with special needs is increasing, and the state is struggling to provide the specialized services they need, according to the report. Providers of these services are struggling with low reimbursement rates and staff shortages in addition to the increasing need.

“It’s also important to note that children with special needs are less likely to receive high quality care, and more likely to stay at home with a parent — disproportionately mothers — who are then prevented from participating in the economy,” said Carla Abdo-Katsipis, a research and policy fellow at Connecticut Voices and one of the authors of the report.

This means that many families don’t have access to the services they need.

Some public policies are helping. There’s increased enrollment in Care 4 Kids, a program that helps pay for child care, among infants and toddlers and more preschool enrollment in Care 4 Kids, Head Start and school readiness programs, according to the report.

Robust child care can benefit the overall economy, the report argues. The state’s early child care industry brought in $718 million in total industry revenue in 2016, the report says.

“This increase in enrollment, particularly infant and toddler enrollment, is good news considering that businesses lose operational revenues for every parent without good infant and toddler care,” says an executive summary of the report. “Businesses thrive when parents can access stable ECE, and when businesses and parents thrive, the state thrives.”

The report also set out a series of recommendations to meet four goals: invest in and support the early care and education workforce, increase equitable and affordable access to early care and education, streamline the state’s overall system so it’s more flexible, and invest more money in the system.

The suggestions in the report were similar to recommendations from Lamont’s Blue Ribbon Panel. They ranged from creating more affordable housing for early care and education workers to directing a dedicated revenue stream for the system and raising reimbursement rates, and ensuring early care and education workers have better wages.