Affordability has dominated the conversation in New Jersey’s governor’s race — and for good reason. Families are stretched thin, squeezed by record housing prices, soaring energy bills, and everyday costs that outpace paychecks.
But amid all the talk of property taxes and inflation, one of the biggest drivers of this crisis is hiding in plain sight: childcare. In New Jersey, the cost of care for two children now tops $26,000 a year — more than most families pay on their mortgage or tuition at Rutgers. When parents must spend a quarter of their income just to keep working, affordability stops being a personal problem. It becomes an economic emergency.
Childcare is one of the biggest drivers of unaffordability in the state, and it’s quietly constraining New Jersey’s growth. The state loses $3.6 billion each year in lost earnings, productivity, and revenue because parents, primarily mothers, can’t find or afford care.
Businesses feel that loss in real time: trained employees leave, absenteeism rises, and recruitment pipelines dry up. Small businesses, health care systems, and manufacturers alike are struggling to maintain staffing as childcare gaps ripple through the workforce.
New Jersey’s affordability challenge is already driving corporate relocations. In the past seven years, the state has seen a 29% drop in Fortune 500 companies headquartered here, and affordability consistently ranks among the top reasons businesses leave. Fixing childcare isn’t just a quality-of-life issue, it’s a competitive advantage.
That’s why some New Jersey employers are stepping up to address childcare directly. Companies that offer on-site childcare or stipends see clear returns: Research from Moms First and Boston Consulting Group shows that every dollar invested in childcare benefits yields up to 425% in ROI, primarily through retention and productivity gains.
But small and midsize businesses, the backbone of New Jersey’s economy, can’t shoulder those costs alone. Public-private partnership is essential if we want to keep our workforce strong.
That’s why in September the New Jersey Business & Industry Association, Moms First, and a coalition of childcare advocacy groups and philanthropies invited both the Ciattarelli and Sherrill campaigns to come together for the launch of Start Strong NJ, a new initiative to make affordable, accessible childcare a top statewide priority.
The event made one thing clear: childcare isn’t just a family issue or a social issue. It’s a business issue — and one that goes to the heart of New Jersey’s economic competitiveness.
We’ve both seen this firsthand how inadequate childcare forces talented women out of the workforce and constrains growth. To address this, Moms First built the National Business Coalition for Child Care to help companies realize and advocate for family-friendly solutions. Over the past two years, Moms First has worked on the ground in New Jersey to underscore the business case for childcare, helping employers and industry leaders recognize the workforce constraints of a broken childcare system.
NJBIA works with employers every day who cite childcare as one of their top workforce challenges. Many of our members are themselves childcare providers, small businesses struggling to survive within a broken model where educators earn poverty-level wages while parents pay college-level tuition.
It’s time to fix the system. The next governor and Legislature must treat childcare as a core economic investment, guided by three common-sense principles:
- Stabilize the workforce
New Jersey’s childcare educators are more than twice as likely as other workers to live in poverty. That’s unsustainable. These professionals are the foundation of every other industry, yet they struggle to afford care for their own families.
The state should ensure all childcare educators qualify for the Child Care Assistance Program, expand apprenticeship and training pathways, and include them in student loan forgiveness programs like Pay It Forward NJ. Compensation must be competitive with public-school teachers with similar experience, supported by public funds and targeted tax credits. A stable childcare workforce means a stable statewide workforce.
- Modernize preschool expansion through mixed delivery
Public preschool expansion has been one of New Jersey’s great achievements, and it lays a vital foundation for childcare affordability for all — but it must be built in partnership with private and community-based providers, not at their expense.
In addition to the imbalance created by an infant-heavy enrollment model, regulatory requirements for capital investments have created strain for existing providers. Providers are interested and willing to retrofit their facilities, but they are forced to take a gamble — without guaranteed enrollment into the program or long-term contracts from school districts. A mixed-delivery model — where public funds support both school-based and licensed community providers — would expand capacity efficiently, keep small businesses afloat, and offer families more accessible options.
- Incentivize business participation
New Jersey should enact a tax credit for employer-provided childcare, mirroring recent federal advancements and matching what 17 other states have already done.
This policy would reward companies that invest in on-site care, partnerships with local centers, or direct stipends for employees. Even better, the recently approved federal tax improvements offer enhanced incentives and flexibility for small businesses, which make up over 50% of New Jersey’s employers. It’s a win-win for business and families alike, strengthening retention while reducing workforce disrupt
We know New Jersey faces fiscal constraints, and the next governor will have to make tough choices about how to allocate state resources. But the data is clear: investing in childcare delivers one of the strongest returns of any public investment — boosting workforce participation, business productivity, and tax revenue. States from Connecticut to New Mexico are already proving what’s possible with bold public-private action. New Jersey has the talent, infrastructure, and bipartisan will to lead — but only if we act.
Childcare is pro-business and pro-family. It’s essential for New Jersey’s economy. It’s time we treated it that way.
Reshma Saujani is founder and CEO of Moms First. Michele Siekerka is the CEO of the New Jersey Business & Industry Association.
