State budget subsidizes more child-care spaces but workforce pay lags

By the Editorial Team · Thursday, July 9, 2026

Despite increased state funding and expanded early childhood programs, child-care costs in Los Angeles County remain high and subsidies have not kept pace with actual provider expenses. Advocates are pushing for legislation to raise reimbursement rates and improve workforce pay to ensure the sustainability and quality of care.

Child-care access and affordability continue to challenge families in Los Angeles County despite increased state investment in early childhood education. In 2024, parents face median monthly costs of $1,209 for full-time infant care at family child-care homes and $1,818 at centers, according to data from the California Budget & Policy Center. Preschoolers’ care averages $1,121 at homes and $1,271 at centers, while school-age children’s care costs $884 and $959, respectively.

Over the past four years, Governor Gavin Newsom has expanded early childhood education, including the creation of a new grade offering free transitional kindergarten to all 4-year-olds, backed by $2.7 billion in funding. His administration also enacted legislation to unionize child-care workers statewide through Child Care Providers United, resulting in increased wages and the establishment of healthcare and retirement benefits for providers. Furthermore, family fees for subsidized care were capped at 1% of household income, a significant reduction from the previous limit of nearly 10%.

Despite these advances, advocates argue that funding gaps remain, particularly regarding child-care workforce pay and rate reform. Current state subsidies in Los Angeles are tied to 2018 market rates, covering up to $1,122 for infant care, $1,006 for toddlers, and $753 for school-age children at family child-care homes. These reimbursement rates fall below the actual median costs and do not reflect the current expenses providers face in operating their programs. Advocates note that the state budget did not include support for rate reforms that would close this gap.

Additionally, the budget maintained only a 2.01% cost-of-living adjustment for state preschool staff and child-care providers managing subsidized programs, a raise advocates say is insufficient to keep pace with rising costs and the need for workforce stability. “If you’re expanding spaces, you need to be making sure that we have a stable and growing workforce, and our budget does not account for that second half of the equation,” said one child-care advocate.

In response, child-care advocates are backing Assembly Bill 1981, which would establish a timeline for raising provider reimbursement rates to better cover operational costs. While acknowledging the increase in state support has been significant, some experts urge continued focus on improving quality and sustainability.

“This growth has been monumental for California’s early childhood landscape,” said Rick Fuller, an early education expert. “I think the new governor will arrive with a more stable and more generous early education system than we had eight years ago. Hopefully, the focus will shift more toward improving quality.”

The ongoing debate reflects broader concerns about balancing expanded access with fair compensation and long-term viability of the child-care workforce in California.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.