U.S. Child Care Market Size, Share & Trends Analysis Report By Type (Early Care, Early Education & Daycare, Backup Care), By Delivery Type (Organized Care Facilities, Home-based Settings), And Segment- Industry Analysis, Share, Growth, Regional Outlook and Forecasts, 2023-2032

The U.S. child care market size was exhibited at USD 61.9 billion in 2022 and is projected to hit around USD 93.31 billion by 2032, growing at a CAGR of 4.19% during the forecast period 2023 to 2032.

Key Takeaways:

• Based on type, the market is segmented into early care, early education & daycare, backup service & others. Early education & daycare accounted for the largest revenue share of 48.0% in 2022.
• The early care segment is expected to grow significantly during the forecast period.
• Based on delivery type, the market is segmented into organized care facilities and home-based settings. The organized care facilities segment accounted for the highest revenue share of 72.9% in 2022 and is expected to witness the highest CAGR during the forecast period.
• The home-based settings are expected to witness lucrative growth during the forecast period.  

U.S. Child Care Market Report Scope

The key factor driving the growth is the rising demand for early daycare & education services with more parents returning to working in offices, the rising number of single & working mothers, advancements in learning technologies for children, and the accessibility of government funding. The expenditure on daycare in the U.S. is very high. As per the cost of care survey facilitated by the U.S. Department of Health and Human Services, the expenditure on these services reached up to 7.9% of the household income in 2021. Families in the U.S. are willing to spend more on childcare services, indicating the high service demand in the U.S.

Furthermore, single-parent families are growing in the U.S. As per the 2022 single-parent statistics, in 2022 there were around 11 million single-parent families in the U.S. Single-parent families cannot give the required attention to the child, thus relying on childcare centers or their kid's early education and well-being.

In addition, the Southern states in the U.S. have the highest single-parent population. South Carolina, Florida, Georgia, Mississippi, and Louisiana have the highest number of single-parent households. Louisiana reported over 40% single-parent households, the highest in the U.S. Hence, the southern region is expected to have the highest demand.

The COVID-19 pandemic significantly impacted the U.S. childcare market, affecting providers and families who rely on childcare services. The pandemic compelled service providers to discontinue their services in 2020. For instance , according to the Department of Human Services, 260 childcare facilities in Pennsylvania permanently closed during the pandemic. This resulted in a severe lack of accessibility and a loss of revenue for the market players.

Type Insights

Based on type, the market is segmented into early care, early education & daycare, backup service & others. Early education & daycare accounted for the largest revenue share of 48.0% in 2022. This can be attributed to monetary support from the government that can enable children from lower-income families to access childcare services. For Instance, the Department of Early Education and Care provides grants for center-based early education services. All EEC-licensed childcare service providers are eligible for this grant.

The backup care segment is expected to witness lucrative growth owing to the increasing number of working single parents driving growth. In some of the states in the U.S., the state government has laws requiring employers to provide backup service benefits. For instance, in March 2021, the California state government proposed a new bill making it mandatory for employers to facilitate subsidized backup care service benefits to their employees, thus boosting the growth opportunities for the segment in the region.

The early care segment is expected to grow significantly during the forecast period. This growth can be attributed to increased funding for high-quality early care programs. Several states and localities have implemented policies to expand access to early care, such as universal prekindergarten programs and increased funding for Head Start programs.

Delivery Type Insights

Based on delivery type, the market is segmented into organized care facilities and home-based settings. The organized care facilities segment accounted for the highest revenue share of 72.9% in 2022 and is expected to witness the highest CAGR during the forecast period. The rising number of working parents, technological advancement, and growing funding for supporting quality early education drive segment growth.

Furthermore, the organizations facilitating daycare collaborate to enable large-scale organized daycare. For instance, the first Steps 4K, an organization facilitating early education for 4-year-old children, collaborated with 200 non-profit daycare centers to facilitate high-quality early education as per the child's requirements.

The home-based settings are expected to witness lucrative growth during the forecast period. Home-based child care is popular for many families, particularly those with younger children or irregular schedules. According to a report by HomeGrown Childcare, approximately 7 million children under the age of five receive care in a home-based setting. It offers a range of benefits to families, such as lower costs, personalized care, and a more home-like environment. These benefits are expected to fuel the growth of the segment.

Key Companies & Market Share Insights

The market is very competitive, with the presence of several large & small players. Market players & government agencies adopt this strategy to increase the outreach of their services in the market and increase the availability of their services in diverse geographical areas. For instance, in January 2023 , the Children's Bureau of the U.S. Department of Health and Human Services (HHS) introduced a grant to enhance coordination between child welfare services and early childhood education programs. Some prominent players in the U.S. child care market include:

• Bright Horizons Family Solutions
• KinderCare Learning Centers LLC.
• Learning Care Group, Inc.
• Spring Education Group
• Cadence Education
• The Learning Experience
• Childcare Network
• Kids 'R' Kids
• Primrose School Franchising SPE, LLC.
• Goddard Franchisor LLC

Segments Covered in the Report

This report forecasts revenue growth at country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2032. For this study, Nova one advisor, Inc. has segmented the U.S. Child Care market.

By Type 

• Early Care
• Early Education & Early Daycare
• Backup Care
• Others

By Delivery Type 

• Organized Care Facilities
• Home-based Settings