For a growing number of Canadian families, the search for daycare is beginning before the nursery is finished — and sometimes before the baby is born. The country’s push toward $10-a-day child care has dramatically lowered fees for families fortunate enough to secure regulated spaces, but affordability has exposed a second problem: there are not enough accessible spaces to meet demand.
By 2025, nearly one-third of parents with children aged five and younger reported having a child on a daycare waitlist, while half of parents using child care said they had encountered difficulty finding it. The situation has turned what was supposed to be a major affordability breakthrough into a race for limited capacity. In some communities, getting the lower price is no longer the biggest challenge. Getting through the door is.
The $10-a-Day Promise Changed the Math for Families
Canada’s national child-care expansion was built around a straightforward goal: regulated care should no longer consume a huge portion of a family’s income. Ottawa committed billions beginning in 2021, negotiating agreements with every province and territory and setting an objective of average fees of $10 a day. By 2026, eight provinces and territories were offering regulated care for an average of $10 a day or less, while the remaining jurisdictions had cut average parent fees by at least 50 per cent from earlier levels.
The savings can be substantial. Federal estimates put annual savings for families at roughly $7,000 per child in Ontario, $7,600 in Alberta, $6,000 in New Brunswick and $5,500 in British Columbia compared with previous fee levels. For a household with two young children, that can fundamentally change the calculation around returning to work. The affordability achievement is therefore real. The problem is that a $10 or $20 daycare spot provides no financial relief to a parent who cannot actually obtain one. The policy succeeded at making subsidized places significantly more desirable before the supply of those places had expanded enough to accommodate everyone seeking them.
Falling Fees Have Put Even More Pressure on Limited Spaces
The clearest sign of the imbalance is the growth of waitlists. Statistics Canada found that 31 per cent of parents with children aged five and younger reported having a child on a child-care waitlist in 2025, up from 26 per cent in 2023. Among families already using child care, half reported difficulty finding care in 2025. When those parents were asked what made the search difficult, a lack of available care in their community was the most frequently cited problem.
The pressure is also visible from the provider side. In 2024, 77.3 per cent of child-care centres reported having an active waitlist, along with 61.5 per cent of licensed home-based providers. C.D. Howe Institute researchers argue that lower fees have encouraged more families to seek regulated care, including some who previously relied on relatives, informal arrangements or other alternatives. That is partly what a successful affordability policy would be expected to accomplish. But when demand grows faster than classrooms, licensed homes and staffing capacity, the benefit becomes unevenly distributed. Families who secure a subsidized place can save thousands of dollars; those who do not may remain exposed to considerably more expensive alternatives.
Pregnancy Has Become the New Starting Line for the Daycare Search
The competition has produced one of the strangest rituals of modern Canadian parenthood: applying for daycare before there is a child to send. In an August 2026 assessment of the system, C.D. Howe Institute researchers reported that parents are increasingly putting children on lists before birth and that some pregnant parents are being told they have already started too late. What once sounded excessively cautious is becoming a rational response to waitlists that can extend well beyond a standard parental leave.
Official guidance reflects the same pressure, even when it does not explicitly tell families to apply during pregnancy. Prince Edward Island recommends beginning the registration process as early as possible and registering with multiple centres. Toronto similarly encourages families to register early because its municipal child-care programs operate with waitlists. The problem becomes particularly acute for infants. In December 2025, P.E.I.’s provincial registry contained about 1,800 names, including more than 1,400 families waiting for infant care and close to 800 needing an infant space immediately. For parents approaching a scheduled return to work, a theoretical future opening does little to solve a deadline measured in weeks.
Canada Has Added Spaces, but Expansion Has Lagged Behind the Original Goal
When the Canada-wide system was launched, lower fees were only one part of the plan. Ottawa also targeted the creation of 250,000 new affordable child-care spaces by March 2026. The Office of the Auditor General found that a little more than 112,000 spaces had been created by March 2024, leaving more than half of the five-year target to be delivered during the final two years. The audit warned that families would have less access than planned if expansion failed to accelerate.
Later federal updates require careful interpretation. As of December 2025, Ottawa said provinces and territories had announced measures to create more than 200,000 spaces. By June 2026, the federal government said measures had been announced for more than 250,000. That is encouraging, but an announced or funded space is not necessarily an open, staffed space available to a family today. New centres require buildings, licensing, equipment and workers before children can enter them. The Auditor General also criticized gaps and delays in national performance information, making it harder to compare promised capacity with operational capacity. C.D. Howe concluded in 2026 that actual expansion had not kept pace with the demand created by lower fees.
The Bigger Bottleneck May Be the People Needed to Run the Daycares
A new classroom cannot simply be declared open. It needs qualified adults, and Canada’s early-childhood-education workforce has become one of the biggest constraints on expansion. Statistics Canada found that 86.4 per cent of child-care centres that tried to fill vacancies in 2024 encountered difficulties doing so. C.D. Howe’s analysis of labour-market data found that early-childhood-educator vacancies remained substantially above pre-pandemic levels in 2025 even as offered wages had risen.
That creates a capacity problem that construction alone cannot fix. A centre may have physical room for more children but be unable to operate that room safely without enough educators. Hiring difficulties can also force operators to compete for the same limited pool of trained workers as governments simultaneously fund new spaces. Provinces have introduced wage enhancements and other workforce measures, but compensation, benefits, working conditions and career opportunities remain central to retention. This makes the daycare shortage different from simply having too few buildings. Canada is effectively trying to expand an entire labour-intensive service network at the same time that it makes that network dramatically cheaper for consumers. Without enough educators entering and staying in the profession, newly funded capacity can take much longer to become usable capacity.
The Shortage Is Especially Difficult for Infants and Parents Working Outside 9-to-5 Hours
Not every child-care space is interchangeable. An opening for a preschool-aged child does not solve the problem for a 12-month-old, and a centre closing in the late afternoon is of limited use to a nurse, factory worker or restaurant employee scheduled into the evening. The large infant backlog recorded in P.E.I. illustrates how shortages can be concentrated within particular age groups even while governments continue adding capacity. The province reported creating hundreds of spaces beginning in 2023, including infant places, yet demand for infant care remained substantial.
Hours of operation reveal another gap. Statistics Canada reported that 87.8 per cent of centres offered full-time care in 2022, but only 1.7 per cent offered evening, weekend or overnight care. Home-based settings were more likely to provide non-standard options. That matters because Canada’s workforce is not built entirely around weekday office schedules. Child-care researchers have estimated that a significant share of young children have at least one parent working non-standard hours. For those households, counting the total number of licensed spaces can exaggerate practical availability: a space only counts as accessible if it matches the child’s age, location and the hours when care is actually needed.
Affordable Child Care Can Boost Employment — but Only When Parents Can Access It
The economic case for subsidized child care has always extended beyond household savings. Making care less expensive can make returning to employment financially worthwhile, particularly for mothers who have historically been more likely to reduce working hours or leave employment because of caregiving responsibilities. In 2025, the labour-force participation rate among Canadian mothers aged 25 to 54 with young children reached 79.5 per cent, which the federal government described as close to a record high.
It would be overly simplistic, however, to attribute every increase in employment to the national child-care program. Economic conditions, parental-leave decisions, wages and demographic changes also matter. Longer-term research from Quebec provides stronger evidence that access to low-fee care can affect careers over many years. A 2026 National Bureau of Economic Research paper by Michael Baker, Jonathan Gruber and Kevin Milligan found enduring employment and earnings effects among mothers exposed to Quebec’s universal child-care program, with fiscal benefits potentially recovering between 75 and 117 per cent of the program’s initial cost over the lifecycle. But those gains depend on access. A parent sitting on a two-year waitlist cannot make employment decisions based on a space that does not exist yet.
Fixing the System Means Treating Availability as Seriously as Affordability
The next phase of Canada’s child-care experiment is therefore less about proving that lower fees are popular and more about building enough capacity to make those fees broadly accessible. Researchers and auditors have repeatedly pointed toward several pressure points: faster creation of spaces in underserved communities, stronger recruitment and retention of early-childhood educators, more flexible forms of regulated care and better national data showing where spaces actually exist. The federal government has extended major child-care funding beyond the original five-year agreements, giving provinces and territories a longer runway to tackle those challenges.
There is also an emerging debate over whether future support should remain overwhelmingly tied to subsidized regulated spaces or provide additional help to families who cannot obtain them. C.D. Howe has proposed measures including targeted expansion and an income-tested refundable tax credit for families relying on non-subsidized care, while OECD research emphasizes directing scarce resources toward disadvantaged children when capacity is limited. Governments may choose different solutions, but the fundamental challenge is becoming difficult to ignore. Canada has shown that public policy can make child care dramatically cheaper. The unfinished task is making sure parents do not have to join a queue before their baby is born just to have a realistic chance of benefiting from it.
