Private Equity Impact on Child Care

Parents looking for childcare in the United States know how expensive it can be. 

A study authored by Jessica Brown of the University of South Carolina and Chris Herbst of Arizona State University finds no evidence that private equity is the primary reason child care is unaffordable, though an investigation by the U.S. Congress has been underway in 2026 and at least some legislation to regulate PE investments in childcare have been proposed. 

By some estimates eight of the 10 largest childcare providers now are owned by PE firms. 

A study of PE-owned childcare operations in the Netherlands found higher prices (three- to four-percent) but also fewer regulatory infractions, which some will argue suggests higher quality. 

That study also found that PE-owned facilities do not set the pricing strategies for other providers.

 

But private equity investments in childcare are likely to remain an issue, as is the case with PE ownership of other assets with a “social” character, such as health care or veterinary services.