Child-care costs rising rapidly in Canada's biggest cities, study finds

Average Canadian child-care costs are climbing three times faster than inflation — up eight per cent since 2014 — and that could mean an extra $1,000 a year for parents in cities where daycare is most expensive, a new report says.

Growing cost of child care is outpacing inflation, according to Canadian Centre for Policy Alternatives

Average Canadian child-care costs are climbing at a rate that's three times faster than inflation 2:11

Average Canadian child-care costs are climbing three times faster than inflation — up eight per cent since 2014 — and that could mean an extra $1,000 a year for parents in cities where daycare is most expensive, a new report says.

"This is really putting the squeeze on parents," said David Macdonald, a co-author of the report and senior economist at the Canadian Centre for Policy Alternatives.

David Macdonald is co-author of the CCPA's report on growing child-care costs. (CBC News)

The study by the CCPA —  an organization that calls itself a progressive voice whose work is "rooted in the values of social justice and environmental sustainability" — tracks the median price of child care across 28 Canadian cities for three age groups: infants, toddlers and preschoolers.

The median, or middle value, was used because Macdonald says it isn't as affected by extreme outliers as the average would be.

Toronto parents pay most

Big cities are where child-care costs bite the deepest.

Toronto ranks as the most expensive for all age groups, from a median of $1,649 a month for infants, to $1,375 a month for toddlers and $1,150 a month for preschoolers.

Here's some simple math that has a very big message:

"Take a family in Toronto that has an infant and a toddler in regulated care. That amounts to $3,000 a month, which over the course of the year is going to be $36,000," says Macdonald.

"And you compare that to tuition in Ontario that's around $10,000, and you can see that you're paying dramatically more for child care than you are just for tuition, a university tuition."

Other cities like Vancouver and Calgary aren't far behind.

Child-care fees are the least expensive in Quebec, where prices are set by the province and are the same across all age groups. In Montreal, parents are responsible for $164 a month for child care, while in Gatineau, Laval and Quebec City, they pay $179 a month.

Manitoba is the second least expensive. There, the median ranges from $451 for toddlers and preschoolers to $651 for infants in Winnipeg.

There's one thing that parents across the country all have in common, however: the wait.

Paying to wait

The report says that in almost all the cities surveyed at least 70 per cent of regulated child-care centres have a wait list.

"Sometimes it could take six months or a year, or even more, to get to the front of that list," Macdonald said.

"And oftentimes, centres maintain fees — so you need to pay a fee even to get on the list, further increasing the cost to parents who are trying to find child care."

Ontario banned the practice of charging wait list fees as of Sept. 1, but it continues in other provinces.

Low-income parents

All provinces, except for Quebec, help to offset fees for lower-income families by covering all or part of child-care costs. The formulas that determine the size of subsidy are complex and vary from province to province.

In Ontario, families eligible for subsidies pay the lowest fees in the country — about $90 a month out-of-pocket.

In other provinces, it's a much different story. The survey found subsidy-eligible parents in Saskatoon and Calgary still pay as much as $500 a month out-of-pocket for a preschooler.

The study also points out that the federal government has announced plans to make a $500 million investment in child care in its 2017 budget. How that might change the economics of child care is still not clear.

OECD: Canada most expensive

Earlier this fall, the Organization for Economic Co-operation and Development released a report that included a look at child-care costs. The group of wealthy nations found Canada to be among the most expensive for daycare among its 35 members.

It also found that Canadian families spend almost one quarter of their income on child care, a ratio that it says is much higher than in other parts of the world

About the Author

Jacqueline Hansen

Senior Business Reporter

Jacqueline Hansen is a Senior Business Reporter for CBC News. Based in Toronto, she's been covering business and other news beats since 2010.

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