Subsidized Child Care Providers – and Children – Can’t Afford a Pay Cut
During this unprecedented health and economic crisis, many subsidized child care providers in California have stepped up to the challenge of providing early learning and care for families with low and moderate incomes – particularly for children with parents who are essential workers. While the state and federal government have both provided emergency funding to support subsidized child care providers, total support falls far short of the estimated level necessary to sustain child care providers. In addition, the Governor’s May Revision would cut provider payment rates by 10%. These rate cuts could be detrimental for child care providers who were already underpaid and operating on thin margins prior to the COVID-19 pandemic. Now, during this crisis, providers are faced with dramatically higher costs due to smaller class sizes, increased staffing per child, and the added expense of keeping facilities clean as they care for and educate children.
Corporations Pay Far Less of Their California Income in State Taxes Than a Generation Ago - Even Amid COVID-19
The share of California corporate income paid in state taxes declined by more than half during the past three decades. In the early 1980s, corporations that reported profits in California paid more than 9.5% of this income in state corporation taxes. In contrast, corporations paid just 4.2% of their California profits in corporation taxes in 2017, the most recent year for which data are available. California’s state budget would have received $11.2 billion more revenue in 2017 had corporations paid the same share of their income in taxes that year as they did in 1981 – more than the state spends on the University of California, the California State University, and student aid combined. Corporations pay less of their income in taxes today - even amid the COVID-19 economic crisis - than they did in the 1980s in part due to the reduction of tax rates by state policymakers.
California Job Losses Are Concentrated in Industries With Low Average Weekly Earnings
Californians working in low-paying industries were more likely to lose their jobs since the COVID-19 economic crisis began. Low-paying industries saw a 26.8% decline in jobs from February to April, a loss of over 1.5 million private-sector jobs. This accounts for roughly 62% of private-sector jobs lost.