- Home
- /
- Policy Impact Calculator: 2020 through 2024
Policy Impact Calculator: 2020 through 2024
VARIATION IN STATE POLICY CHOICES SINCE 2020 WIDENS GAP IN FAMILY RESOURCES
Since 2020, every state has invested in at least one of the effective policies or strategies included in the Prenatal-to-3 State Policy Roadmap. However, policy choices vary substantially across states, which leads to large differences in the resources available to families.
Importantly, these state policy choices do not operate in isolation – they interact to create a system of care that provides a minimum threshold of resources for families. States that have implemented multiple effective policies have seen the largest increases in the total resources available to working families since the 2020 Roadmap was released.
The Policy Impact Calculator brings the Prenatal-to-3 State Policy Roadmap to life and compares the level of resources available to a working family of three, of a working parent with an infant and toddler, based on each state’s policy choices. Across all 50 states and the District of Columbia, the Policy Impact Calculator accounts for state and federal policies that interact complexly to create a system of support for parents and children, specifically:
- State minimum wage
- Paid family and medical leave (PFML)
- Child care subsidies
- Federal nutrition programs (SNAP and WIC)
- Federal and state income taxes and credits (CTC and EITC)
- Federal and state payroll deductions (FICA and PFML premiums)
WIDENING GAP BETWEEN STATES
The variation in state investments has led to a growing divide in the resources available to families across the country. In 2020, the difference in total resources between the state with the highest and lowest levels was $22,625. By 2024, this gap had grown to approximately $33,457.
SUBSTANTIAL GAINS IN MANY STATES, BUT LOSSES IN OTHERS
In all but two states, the total resources available to a working, single-parent family with two young children are greater in 2024 than in 2020. However, in eight states, the increase in total resources is driven entirely by increases in resources from federal policies, specifically: federal increases in the EITC, CTC, SNAP, and WIC, masking losses due to declining state resources. Examining the change in resources over time due to state and federal policies further highlights the widening gap between families due to state policy choices.
In the states with the largest gains, increases were driven by:
- Increases in the state minimum wage
- Implementation of statewide paid family and medical leave policies to protect lost wages
- Expansions of refundable state tax credits
- Increased provider reimbursement rates for child care and lower family copayments and fees.
In eight states, families have seen a decrease in available state resources over this time period. This is often due to the price of child care rising faster than subsidy reimbursement rates, which leads to higher out-of-pocket expenses for families. In most cases, increases in federal supports such as SNAP and the federal EITC have helped offset some of these state-level losses; families in Wisconsin and Idaho, however, experienced a net loss. It is important to note that purchasing power has decreased in additional states where very small increases in resources did not keep up with the rising cost of living.
A TALE OF TWO STATES: COLORADO AND IDAHO
A prime example of this divergence in resources can be seen by comparing Colorado and Idaho. Since the 2020 Roadmap, Colorado has made substantial investments in its system of care for families with young children. Specifically, Colorado:
- Implemented a 12-week paid family and medical leave program, protecting $6,229 in wages for a parent with a new child.
- Increased the state minimum wage from $12.00 to $14.42, adding $5,034 in annual earnings.
- Expanded the refundable state EITC from 10% to 50% of the federal credit, boosting the maximum benefit by over $1,685.
- Provided a state child tax credit and Family Affordability Credit, providing $8,360 in crucial cash resources in Tax Year 2024.
- Increased child care subsidy income eligibility, reduced family copayments, and raised provider reimbursement rates, resulting in a $120 decrease in annual out-of-pocket child care costs.
- As a result, the total resources available to a working single-parent family in Colorado grew from $32,703 in 2020 to $54,330 in 2024 – a 66% increase.
In contrast, Idaho has seen little legislative action on prenatal-to-3 policies over the same period. The state’s minimum wage remains at the federal level of $7.25 per hour, there is no statewide paid family and medical leave program, and the state does not have an EITC. Meanwhile, child care costs have risen substantially, whereas reimbursement rates remained stagnant, which leads to huge out-of-pocket costs for care.
The loss in resources due to state policy choices are too large to be offset by the gains from federal supports via refundable tax credits and nutrition programs. Consequently, the minimum resources available to Idaho working families decreased from $23,747 in 2020 to just $20,873 in 2024 – a loss of nearly $3,000, before accounting for inflation.
These diverging state examples exemplify how state policy choices can either expand or limit the minimum resources available to support full-time working parents with young children.
See how the resources for families in your state have changed over time due to policy choices below, with more details available on your state’s 5 Year Prenatal-to-3 State Policy Roadmap.
HOW DO WE CALCULATE RESOURCES?
Our calculations simulate the level of resources available annually for a single parent with an infant and toddler. The parent works full time at a minimum wage job for 9 months and takes 12 weeks of leave from work under the Family and Medical Leave Act (FMLA) following the birth of the infant. If a state has a paid family and medical leave program, benefits are included in the calculation. We assume the parent uses a child care subsidy to enroll both children in center-based child care that charges the equal access target rate (which is the 75th percentile of the state’s most recent market rate survey).
Our calculations begin with the total annual earnings at the state minimum wage and, where available, paid family and medical leave benefits. We subtract the family’s out-of-pocket costs for child care, which include any required copayment, plus additional fees if the state’s child care subsidy reimbursement rate is less than the 75th percentile. We then add the resources that a family would expect to receive from federal nutrition benefits (SNAP and WIC) and federal and state earned income and child tax credits (EITC and CTC). Lastly, we subtract any federal or state income taxes, as well as payroll contributions under the federal insurance contribution act (FICA) and state paid family and medical leave programs.
For additional information on the Policy Impact Calculator methodology, see Methods and Sources.
Related Resources: Economic Supports, Prenatal-to-3 State Policy Roadmap, State Policy News
