How does North Dakota compare on childcare affordability?
The lack of affordable childcare is a national issue. Some states, however, have it worse than others.
So, how does North Dakota compare?
According to ChilCare Aware, in 2022, parents in North Dakota (ND) spent a little under $10,000 to send an infant to a licensed daycare center. This was 14 percent of the state’s median household income. ND ranked as eighth most affordable state for center-based infant care — California not included.
Among its neighbors, North Dakota came second to South Dakota, which was the most affordable state in the country and fared better than Minnesota — one of the least affordable states in the country — and Montana which ranks in the middle.
Figure 1: Annual cost of center-based infant care as a percent of median household income, 2022
Similarly, for toddlers, ND parents spent $9,325, or 13 percent of the state median household income. ND ranked sixth most affordable state for center-based toddler care. And for 4-year-olds, parents spent about $9,000 or 12 percent of the state median household income. ND ranked 13th most affordable state for center-based care for 4-year-olds.
Why North Dakota is relatively more affordable
Certainly, the economics of childcare are challenging. But that is true in ND as it is true in Minnesota or Montana. So, this does not explain why childcare takes such a big bite of income in most states compared to North Dakota.
What explains, this difference, however, is regulation. Compared to other states, childcare in ND is more lightly regulated, leading to more affordable prices.
For example, while both ND and Minnesota require one caregiver per four infants and one caregiver per 10 four-year-olds, ND has a higher limit on group sizes for both ages. And while Minnesota requires childcare workers to take thousands of hours of work experience (if they have a high school diploma) ND only requires pre-service training. These differences make it easier for centers to find workers in ND compared to Minnesota, and keep childcare relatively more affordable compared to other states.
In fact, in a report published in 2022, the Center of the American Experiment (CAE) found a relationship between the level of stringency of childcare regulations and the cost of care. That is, states that have more stringent regulations tend to have higher prices.
Compared to its 3 neighbors, ND tied with South Dakota on CAE’s regulatory Index for infants which looked at staff-child ratios, group size limits, and teacher and director hiring requirements). Montana came third, followed by Minnesota. The cost of care also followed the same pattern — with SD coming first, followed by Montana and then Minnesota. Some other factors likely account for the difference in cost between ND and SD despite identical rankings, but the pattern holds more or less.
Table 1: Regulatory index score vs Cost of center-based infant care as a percent of state median household income
| State | Cost of infancy center-based care (As a % of state Median Household Income) | Regulatory Index score for infants (high = more stringent regulations) |
| South Dakota | 11% | 1 |
| North Dakota | 14% | 1 |
| Montana | 17% | 2 |
| Minnesota | 21% | 3 |
There is always room for reform
Thanks to a comparably more welcoming regulatory environment, ND is one of the most affordable states for childcare.
More can be done, however, to improve the cost of daycare. Currently, ND requires 1 staff per 4 infants. In some states, such as South Dakota, the staff can take care of up to 5 kids.
ND could also allow more kids per staff for toddlers. Minnesota, for example, allows 7 kids per caregiver for kids between 16 and 33 months. In ND, the maximum is 5, and the minimum age for toddlers is 18 months, not 16 months. So, the cut-off age for infants could also be reduced from 18 months.