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Odd Lots

The Economics of Building a Childcare Business

Odd Lots

Bloomberg

News, Investing, Business, News Commentary, Business News

4.41.6K Ratings

🗓️ 6 November 2023

⏱️ 49 minutes

🧾️ Download transcript

Summary

Finding good, high quality childcare has been a growing challenge in the US for a long time. The pandemic only made the situation worse, with all kinds of negative knock-on effects for the economy. So what is actually involved in building out a childcare business? What are the costs? How much can it scale? Can it be made more efficient by changing regulations or subsidies? On this episode of the podcast, we speak with Matt Bateman, a member of the founding team at Higher Ground Education, which operates a chain of over 120 Montessori schools across several states. We discuss how the business of early education works, what the opportunities are, and the constraints on making childcare more abundant and affordable for everyone.

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Transcript

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0:00.0

Join us in Seattle on November 8th for Bloomberg's intelligent automation briefing about transformation in a time of uncertainty. During this special evening event, top business and IT executives will gather to explore ways in which intelligent automation can offset economic

0:15.8

pressures and help organizations thrive by enhancing operational efficiencies and stakeholder

0:21.2

value.

0:22.3

This program is proudly sponsored by IBM. Register at

0:25.7

Bloomberg Live.com slash automation slash radio. Hello and welcome to another episode of the Odd Lots Podcast I'm Tracy Alaway. Tracy Alaway. one of these topics that I think we're both interested in, but like news developments keep derailing our pursuit of this area, right?

0:56.6

Things keep happening.

0:57.6

Yeah, really.

0:58.6

And so we can't talk about the economics of preschool.

1:00.6

And I guess the one other time we sort of talked about it like so much of the conversation about like infrastructure or making this economy like more productive like so much emphasis on like the built economy.

1:13.4

The good side of the economy.

1:14.5

The good side factories and can the factories make good batteries and stuff like that?

1:20.1

But I do think that when you look at like long-term challenges for the US, so many things related to like child care,

1:27.6

elder care is a really big one, and the sort of like the economics of these industries that like aren't going to have like some huge productivity breakthrough tomorrow or like it takes a lot of labor and they seem to keep getting more challenging for people.

1:42.4

Right. In many respects they seem to keep getting more challenging for people. Right. In many respects, they seem more troublesome than some of the good sides.

1:46.8

So I think we talked about this before, but certainly if you look at inflation numbers

1:50.9

and if you divide them up by you know consumer goods versus services

1:54.7

the really long-term price pressures are mostly on the services side so again things

2:00.4

like health care and education and then secondly to your point in some respects it feels like okay if there's a

2:06.8

bottleneck of a particular good well we can build a new factory or increased capacity at the ports.

2:13.6

Yeah, you know, I'm sort of simplifying it, but when it comes to care work,

2:19.8

there's this massive labor issue, which you can't just build 50 new preschools in a particular

2:26.3

city because you would still need to man them and even then even if you could get the labor

...

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