Childcare is a fundamental issue impacting millions of families across the country. It's not just a concern for parents but a national issue affecting every corner of the economy. Restaurant owners are particularly affected due to the nature of their workforce and operating hours. Access to reliable, affordable childcare is crucial to ensuring employees can consistently work and contribute to their families and communities. However, the rising costs of childcare and the lack of flexible options put both parents and businesses under immense pressure.

In fact, almost half of all parents face work disruptions due to childcare issues. A staggering 74% of mothers and 66% of fathers have been forced to leave work early, arrive late, or miss work altogether because of last-minute childcare disruptions. With childcare workers themselves earning a median wage of $30,370—barely above the poverty line—this crisis impacts both families and the larger economy.

Restaurants, however, face unique challenges:

  • Irregular Work Hours: Unlike traditional 9-5 jobs, restaurant shifts vary widely, often requiring early morning or late-night care options that many childcare facilities do not offer.
  • Young and Diverse Workforce: Restaurants disproportionately employ younger workers, single parents, and diverse populations who face additional challenges accessing affordable childcare.
  • Higher Rates of Single Parenthood: A significant percentage of restaurant workers are single parents, placing the entire burden of childcare on one parent, which can disrupt their ability to work reliably.

The strain this places on restaurants, already operating with slim margins and inconsistent labor availability, is unsustainable. Without childcare solutions, many workers are forced to choose between maintaining their jobs or caring for their families.

The restaurant industry is the backbone of countless communities across the country. Independent restaurants generate economic activity, provide essential jobs, and contribute to the vibrancy of their neighborhoods. Yet, the current childcare crisis threatens the stability of this industry by placing undue strain on its workforce. Without affordable and accessible childcare, restaurants will continue to struggle with labor shortages, reduced hours, and unstable operations.

By supporting and expanding childcare tax credits and federal programs, Congress can help ensure that restaurant workers—especially the many young, single, and diverse parents who power this industry—can maintain their employment and support their families. These policies are not just about helping parents; they are about driving economic growth, strengthening small businesses, and building a more equitable and prosperous future for all Americans.

Why Federal Programs Are Essential

The IRC is committed to advocating for comprehensive federal solutions to address the childcare crisis affecting restaurant workers. This includes an all-of-the-above approach, expanding access and affordability while supporting both employees and businesses. Current federal tax provisions already offer potential avenues for alleviating the burden on parents and employers, but improvements are necessary.

The IRC is specifically advocating for reforms to three key tax provisions:

  • Child and Dependent Care Tax Credit (CDCTC): This tax credit helps parents offset childcare costs, but it needs to be expanded to ensure it effectively covers the high costs of childcare for working families.
  • Dependent Care Assistance Program (DCAP): This allows parents to set aside a portion of their pre-tax income for childcare expenses, but the current cap is too low for most restaurant workers to make meaningful use of it.
  • Employer-Provided Child Care Credit (45F): This credit provides incentives for businesses to offer childcare services for their employees, but greater support and flexibility are needed for restaurants, which often lack the resources to implement these programs.

Additionally, the Child Care and Development Block Grant (CCDBG) program, which is the largest source of federal funding for childcare, must be protected, prioritized, and expanded. Increased investment in this program would make childcare more affordable and accessible, particularly for low-income families and essential workers in industries like restaurants.

The IRC urges Members of Congress to prioritize affordable childcare solutions for restaurant workers, including expanding existing tax credits and federal programs that support both families and businesses. Specifically:

  • The Child Care Investment Act of 2023, H.R. 4571, introduced by Rep. Salud Carbajal (D-CA) and Rep. Lori Chavez-DeRemer (R-OR). This bill would enhance the three existing tax credits to address the cost and accessibility of child care for working parents. 
  • Promoting Affordable Childcare for Everyone (PACE) Act, H.R. 7360, introduced by Rep. Claudia Tenney (R-NY) and Rep. Brad Schneider (D-IL). This bill would modernize existing provisions in the U.S. tax code to help more families afford child care, including enhancing the Child and Dependent Care Tax Credit (CDCTC) and increasing the amount of pre-tax dollars families can set aside in Dependent Care Flexible Spending Accounts.
  • The Affordable Childcare Act, H.R. 8635, introduced by Rep. Marc Molinaro (R-NY) and Rep. Sharice Davids (D-KS). This bipartisan bill doubles the three existing tax credits that help families access quality and affordable child care.