A dynamic analysis of turnover in employment and child care

The causes of turnover in child-care arrangements and maternal employment are analyzed using panel data from the National Longitudinal Survey of Youth, supplemented with state-level information on child-care markets. The results indicate that turnover in child care is quite high and that child and family characteristics help explain turnover. Important factors include the mother’s wage, the cost of child care, age of the child, and previous child-care decisions. The reduced-form nature of the analysis makes it difficult to determine whether these factors are important because they are associated with unstable child-care supply or because they affect family decisions, conditional on supply factors. The results provide no direct evidence that child-care turnover is higher in states with more unstable child-care markets.