Here are the 5 biggest challenges daycare operators face in 2025, based on recent industry reports and expert insights
1. Staffing Shortages & High Turnover
- 68% of childcare leaders cite hiring and retaining staff as a top challenge.
- Many centers report turnover rates above 30%, with some exceeding 60%.
- Low wages, burnout, and lack of training contribute to this issue.
Solution: Competitive compensation, professional development, and automation tools to reduce staff workload.
2. Enrollment & Family Retention
- Nearly 70% of centers struggle to meet enrollment goals.
- 42% of providers say fewer than half of families re-enroll after the first year.
Solution: Strong onboarding, personalized parent engagement, and centralized enrollment systems.
3. Administrative Overload & Inefficient Processes
- Staff spend 7–9 hours per week on paperwork, lesson planning, and reporting.
- Manual processes for billing, attendance, and licensing slow down operations.
Solution: Automation and integrated childcare management software to streamline operations.
4. Financial Sustainability
- Rising operational costs and low profit margins are squeezing budgets.
- Many centers lack visibility into their financial performance.
Solution: Digital billing systems, expense tracking, and data-driven decision-making to improve profitability.
5. Regulatory Compliance & Licensing
- Frequent inspections and complex licensing requirements create stress.
- Poor organization can lead to missed renewals or non-compliance.
Solution: Use digital tools to track compliance, licensing deadlines, and safety protocols.