Tampa FL (PRWEB) November 14, 2005
Marketdata Enterprises, a leading independent market research publisher of “off-the-shelf” studies about service industries since 1979, has released a 211-page report entitled: "US Child Day Care Services: An Industry Analysis." This is an in-depth market study examining non-profit and for-profit providers of day care services—whether they be group day care chains, church or employer-based facilities, family day care homes, or care by nannies or foreign Au Pairs. The study examines national receipts from 1986-2010F, operating expenses, factors affecting demand, emerging trends, and more. Details and table of contents at: http://www.marketdataenterprises.com.
“There is probably no consumer service that’s more emotionally charged than day care. Fully 65% of mothers with children under age six are now in the labor force. Demand is as strong as ever, but little has changed regarding high turnover and low pay of day care workers. Since demand is strong, fees have been rising substantially. Despite increased federal funding (which is slowing), the quality of much day care remains sub-par, and low pay and high turnover of staff is still a major problem”, according to Research Director, John LaRosa.
1) Five years from now in 2010, Marketdata forecasts the child care services industry to be worth $57 billion, implying average annual sales growth of 4%. Future growth will come from fee increases and household spending of 4-6%/year. Federal funding will slow to less than 1% gains, as the budget gets squeezed by Iraq and budget deficits.
2) In the United States, there are an estimated 117,300 for-profit group day care centers in operation, as well as 290,000 licensed family day care providers/homes and various other facilities run by: churches, colleges, employers, hospitals, the government, etc. - a total of 461,000 provider sites. They all compete for the same day care dollar, but some have an unfair competitive advantage in that they’re subsidized in part and can therefore charge lower fees (i.e., employers, churches).
3) No one company dominates this fragmented field. Competition is keen. Services operate on a tight profit margin - the majority of for-profit centers operating at a 4.4% pre-tax margin. Franchising has not caught on. The top 6 chains operate nearly 4,000 group day care centers and 4 of the top 6 generated $1.3 billion in 2004 sales. This is a small share of the total $47.9 billion market.
4) An estimated 1-3 million live-in Nannies work in the U.S. today, earning $530/week, plus room and board. More parents are installing surveillance equipment to “spy” on them. Au Pairs now number about 16,000 and cost parents $12,000 per year. Their numbers are rising.
5) Marketdata estimates that day care costs are rising 1 percentage point higher than the inflation rate - or 3.5% to 4%. Weekly family child care costs for 2005 will be $122, and $6,079 yearly. By 2010, annual costs will rise to $7,255 per family and $5,550 per child.
6) As of 2002, the “average” day care service had gross annual revenues of $404,000, according to the U.S. Census. The annual receipts per establishment (single location) grew from $174,000 in 1997 to $316,000 by 2002. Non-profits averaged $399,000 vs. $271,000 for the for-profit operations. Just over 50% of day care service establishments are operated by corporations, vs. 44% by sole proprietorships.
“The day care options available to parents are daunting. Does one use a group day care chain, where personal attention is difficult, or a live-in nanny that costs $25,000/year, or something in-between, like employers’ on-site centers, grandparents or other relatives, or a family day care home? Each has its plusses and minuses. Relatives can be unreliable and some nannies have been caught on camera abusing children. It’s a difficult decision and many arrangements are so fragile that when the day care provider can’t make it that day, the system falls apart,” according to LaRosa.
"US Child Day Care Services: An Industry Analysis," published in October 2005, is an independently researched “off-the-shelf” study. The study is 211 pages in length and contains 100 tables and charts. It costs $1,795 and is also sold by individual chapters at lower cost. Digital or print versions available. A free table of contents is available by email or fax.
About Marketdata Enterprises
Marketdata has focused on service sectors and emerging niche markets since 1979, publishing studies about markets as diverse as: collection agencies, weight loss programs, the self-improvement market, check cashing services, pain management programs, medical labs, dental labs, commercial cleaning services, dating services, and parking garages. Custom research and consulting are also offered.
John LaRosa, Research Director
Marketdata Enterprises, Inc.
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