Child care crisis causes economic development problem in rural Minn.

MONTEVIDEO, Minn. - When attorney Janice Nelson of Montevideo emceed a conference in September looking at the region's workforce challenges, she announced at the start just how familiar she was with one of them.Her administrative assistant had ju...

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MONTEVIDEO, Minn. - When attorney Janice Nelson of Montevideo emceed a conference in September looking at the region's workforce challenges, she announced at the start just how familiar she was with one of them.

Her administrative assistant had just quit. She was unable to find child care for her first child.

A "quiet crisis'' is what the Center for Rural Policy in Minnesota calls the growing shortage of child care providers in Minnesota.

It's become an economic development issue for an increasing number of city councils, schools boards and economic development agencies throughout the region. Employers are finding it increasingly difficult to recruit new workers and retain workers due to the child care shortage, and they are letting their local officials know it.

"It's critically important for us for recruitment,'' said Nathan Blad, CEO of RC Hospitals and Clinics. The Renville County-owned hospital has been working with the city of Olivia and the BOLD School District to take on an issue with serious economic ramifications. At the hospital, Blad said more than 80 employees are parents to young children.


Addressing the child-care issue has become a focus for the Southwest Initiative Foundation serving the 18 counties of the region, according to Diana Anderson, CEO and president of the foundation.

In southwest Minnesota, there are 15,662 child care spaces needed, but only 12,528 licensed spaces available. That leaves 3,134 children - or 25 percent of the population ages birth through 6 years - without access to qualify, affordable care, according to the Initiative Foundation.

The foundation also points out that in Minnesota, 74 percent of households with children under age 6 had both parents in the workforce, the third-highest rate in the country.

Home-based child care has been the norm in the region, but the region is seeing a generation of providers retire. New providers are not coming in to fill the gaps, Anderson said.

The Southwest Initiative Foundation and the Greater Dubuque, Iowa, Foundation are jointly looking at the challenges associated with the child care shortage in their regions, and have identified four critical gaps to address. One is in the sphere of public policy. The current regulatory environment makes it difficult for many to start their own, home-based child care centers, Anderson said.

Another gap is the financial and business side of the equation. It's tough for prospective providers to raise the capital to modify their homes and purchase the equipment they need to start.

It's also all about compensation. "There is a disconnect between what you have to charge to make a go of it and what people can afford to pay,'' Anderson said.

Compensation is also a factor for those who may seek an associate degree in early childhood care with intentions of working for a care center. The pay rates of $10 to $12 an hour do not compete with what they could earn in many other fields requiring associate degrees, she explained.


Public awareness of the child care issue and professional development opportunities for providers are another gap needing to be addressed, she said.

Public awareness is growing in the region. John Dotson, superintendent of BOLD Schools, said a series of meetings were held to bring together parties in Olivia to address the community's issue. It's led to the hiring of a consultant to help identify just how big the need is in the community, and how best to address it.

The BOLD School District is interested in helping meet the need, Dotson said.

Right now, communities are discovering that they are largely on their own in addressing the child-care issue. "Every community is being left to its own resources,'' said Granite Falls Mayor Dave Smiglewski.

He pointed out that the neighboring community of Clarkfield recently broke ground on a community-owned child center. The community of Franklin in Renville County already opened its own, and is getting lots of attention for it.

One week ago, the city of Dawson held a community meeting to gather input on what to do.

Smiglewski said the issue of child care became an issue in Granite Falls earlier this year with the closing of a Prairie Five Community Action Council-sponsored center at the Minnesota West Community and Technical College. With its closing, the mayor began hearing from a wide range of employers in town about their concerns. And, of course, he began hearing from many parents struggling to find child care.

"It's easier to find a job than it is to find daycare,'' he said.


Many communities are turning to center-based care facilities to meet the need as the number of home-based centers declines.

Anderson said that comes with its own challenge. It's really hard to get the economy of scale needed in smaller communities to support center-based care. "Where it is working, it is community-supported,'' she said.

Tom Cherveny is a regional and outdoors reporter for the West Central Tribune.
He has been a reporter with the West Central Tribune since 1993.

Cherveny can be reached via email at or by phone at 320-214-4335.
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