PACIFIC BEACH, 2025-06-23
Preschools on the Brink
Childcare centers grapple with tariff-induced price hikes, threatening accessibility.
- Tariffs on Chinese imports are driving up costs for preschools and childcare centers.
- These costs are often passed on to parents, making childcare less affordable.
- Small and medium-sized childcare providers are disproportionately affected.
- Some providers fear that only large childcare chains will be able to survive.
The rising **tariffs on Chinese imports** are creating financial strain for U.S. preschools and childcare centers, which are already operating on tight budgets.
At Includ(Ed), a preschool in Pacific Beach, founder Anna Chiles surveys an unfinished classroom, envisioning a sensory corner and bookshelves. But rising costs cast a shadow on her expansion plans.
“It’s already a miracle to make the budget work,” Chiles said. “Then you add in tariffs, and it starts to unravel.”
The Tariff Squeeze
Preschools and childcare centers are feeling the pressure from increased tariffs on goods imported from China. Many classroom necessities, including furniture and cleaning supplies, are imported.
These tariffs, intended to pressure China, are typically paid upfront by U.S. importers. The costs then trickle down to childcare centers and, ultimately, to parents.
Chiles founded Includ(Ed) as a haven for her son with Down syndrome, after several preschools rejected him. Her school employs specialized staff, including physical, occupational, and speech therapists, along with special educators and music therapists.
“You walk into our classrooms and you’ll see our educators, many who have advanced degrees, their masters,” Chiles said. “You want to be able to pay your folks a living wage, a wage commensurate with their experience and skill. You want to be able to sustain your people while also not squeezing your beloved families.”
Economist Weighs In
Caroline Freund, an economist at UC San Diego, notes that tariffs, while intended to protect domestic industries, often increase consumer prices and burden businesses reliant on foreign supplies.
“It’s exactly the small and medium-sized enterprises that are most impacted,” Freund said. “Margins for the small guys are slim, and so they’re going to pass some of those tariffs on to the consumer right away.”
Freund explained that in addition to the standing 25 percent tariff, there is a 20 percent tariff related to fentanyl and another 10 percent tariff stemming from U.S.-China trade negotiations.
Chiles described the pressures on early childcare providers as suffocating, as prices surge on crucial classroom items.
“The same bookshelf that used to cost $200 now costs $350,” she said. “And we need multiple of everything because we’re expanding to another classroom.”
Ripple Effect on Suppliers
Childcare centers aren’t alone in feeling the impact. Lee Siegel, founder of a San Diego-based company that supplies furniture and learning materials to preschools nationwide, said the combined 30 percent tariff could cost his business $1.5 million in upfront payments on $5 million worth of goods.
“Nobody has infinite resources,” Siegel said. “Just imagine what it’s doing to so many small and mid-sized businesses that … don’t have those additional resources.”
Siegel argues that U.S. importers bear the cost of tariffs, often passing them on to retailers or consumers. He added that some large retailers have refused to absorb the extra cost, leaving mid-size businesses to pay upfront.
“We are the ones who have to front the money,” he said. “We’re the ones who have to carry the load and get reimbursed eventually, maybe, if the customer even still wants the product.”
Those costs, he said, ultimately affect childcare centers.
“There is no extra margin in this business,” Siegel said. “These schools are not flush with cash, they would need to pass [the increases] along to the parents and families, they can’t just absorb price increases.”
Freund notes that larger corporations often have the legal resources or financial flexibility to withstand tariff shocks, unlike smaller importers and childcare nonprofits.
“When tariffs hit, it’s the small importer or the family-run business that suffers the most,” she said. “They have fewer options and less negotiating power.”
Dire Consequences
Chiles believes that the combination of expert staff salaries and rising material expenses could prevent smaller childcare centers from expanding or even surviving.
“If it keeps going like this, only the big chains will survive,” Chiles said. “And they’re not serving kids like mine.”
Catie Griffith, Includ(Ed)’s preschool director, said the school is already experiencing rising prices on basic supplies.
“We’re watching our expenses go up on everything—diapers, wipes, cleaning supplies, even snacks,” Griffith said. “There’s just no room in the budget for surprise costs. None.”
**What are the legal challenges to these tariffs?** Rick Woldenberg, CEO of an Illinois-based education equipment supplier, has taken legal action against the Trump administration, arguing that the tariffs are unconstitutional because the executive branch lacks the authority to impose them without congressional approval.
“We took a body blow when massive tariffs were imposed, and by April 9, it had pretty much re-engineered our entire business,” Woldenberg said.
He said tariffs cost the company $2.3 million in duties across all transactions in 2024. At projected full-year rates, Woldenberg said that figure could skyrocket to $100 million.
“While litigation is expensive, tariffs are more expensive,” he said.
Race Against Rising Costs
Chiles is now hurrying to finalize vendor contracts for an accessible playground, funded by a grant, before prices increase further.
“We got a grant to renovate our playground to make it accessible, but now we’re rushing to spend it before prices go up again,” Chiles said. “If we don’t, that funding won’t go as far.”
Despite the rising costs, Chiles remains committed to creating a nurturing and accessible environment for children who are often overlooked.
“When I tell you every dollar is so vital to us, I really mean it,” Chiles said. “We’re scared of tariffs, we’re very afraid.”
What Parents Can do
Families are also feeling the effects of escalating childcare expenses.But what can parents do to mitigate the impact of these import tariffs?
Open communication with preschools can shed light on their financial situations.Parents can work together to advocate for policies that might help. Several options exist to lower the financial burden on families.
Explore Financial Assistance
Many states offer subsidies or grants to help families afford childcare. Check with your state’s social services or child care resource and referral agencies.
- State Subsidies: These programs offer financial aid to eligible families. Eligibility often depends on income and family size.
- Child Care and Advancement Fund (CCDF): The federal government provides funding for CCDF, which helps low-income families pay for childcare. Requirements vary by state.
- Head Start and early Head Start: These programs offer free or low-cost preschool to children from low-income families. Services include educational, health, and nutrition support.
Advocate for Policy Change
Contact your elected officials about the impact of tariffs on childcare costs. Support policies that could provide relief.
- Lobbying: Contact your representatives to express concerns about tariffs and advocate for their removal.
- Community Action: Join or support parent advocacy groups that focus on childcare affordability.
Budgeting and Cost-Saving Tips
Review your budget and identify areas where you can save money. Every little bit helps in the face of increasing costs.
- Negotiate with Providers: If possible,discuss payment plans or reduced rates with your childcare center.
- Look for Discounts: Some centers offer discounts for multiple children or early payment.
- Share Childcare: Consider sharing childcare responsibilities with relatives or friends to reduce costs.
- Explore Choice Options: Consider alternatives such as in-home care or community-based programs. These may have lower fees.
How are childcare costs affecting families directly? Many families are struggling to pay for childcare, potentially leading to reduced work hours or delaying their return to work after having a baby.
What can parents do to reduce the impact of these tariffs? Parents can explore state subsidies, advocate for policy changes, and create budgets to offset rising costs.
Expert Insights
Several experts have weighed in on the ramifications of tariffs on the childcare industry. Their perspectives help show the bigger picture.
According to a recent study by the National Association for the Education of Young Children (NAEYC), tariff-induced price increases in classroom essentials are contributing to a nationwide childcare crisis. The study showed that many programs are facing challenges offering competitive wages, and as a result, are suffering severe staffing shortages.
“These tariffs exacerbate the financial pressures that childcare providers already face,” said Dr. Emily Carter, a researcher at the NAEYC. “This is a problem for families, for the educators, and for the overall economy.”
Additionally, the Center for American Progress reports that rising costs can lead to parents making difficult choices. These include leaving the workforce,reducing work hours,or compromising on the quality of childcare their children receive. In its analysis, the CAP states that the affordability crunch disproportionately impacts single-parent households and families with young children.
“The situation is not enduring,” said Linda Smith,director of the Early Childhood Policy program at the Bipartisan Policy Center. “We need policies that support both providers and families.”
the Future of Affordable childcare
The future of affordable childcare depends on a combination of factors. These include policy changes,business innovation,and community support.
The current situation puts a premium on finding and implementing affordable solutions.
One potential solution is to seek out local and regional resources, and network with other families experiencing similar challenges.
Many families should and can also explore and embrace the benefits of community-based programs and non-profit organizations that offer assistance to families in need.
Frequently Asked Questions
How do tariffs impact the cost of childcare?
Tariffs raise the cost of imported goods, including the essentials needed for childcare centers, such as furniture, supplies, and cleaning products. These rising costs result in increased tuition fees or decreased operating funds, leading to shortages and difficulty keeping centers staffed.
Childcare providers can seek out lower-cost suppliers for everyday staples, consolidate suppliers, and explore various funding options like grants and government subsidies.They also can communicate openly with parents about the situation.
Are there any government programs to help families with childcare costs?
Yes, many states offer subsidies, grants, and federal funds, such as the Child care and Development Fund, to help families afford childcare or reduce their costs. Families should research local resources and understand the eligibility requirements.
What policy changes could help address this issue?
Possible policy changes to address the issue include eliminating tariffs on essential childcare imports, expanding subsidies for families, and increasing funding for Head Start programs. Parents and advocates can lobby their elected officials to make these changes possible.
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