America’s cities are, unsurprisingly, growing. The great American metropolises—New York; Los Angeles; Chicago; Washington, DC, and more—have long attracted new residents year after year with the promise of jobs, community, and culture. But recently, these cities have hit a snag: despite overall growth rates, families are leaving. 

Since the onset of the COVID-19 pandemic, major urban areas have seen the number of families with young children decrease by 8 percent. Families, perhaps initially in search of more space, have continued moving out of cities after the pandemic because of high housing costs, high costs of living, and safety concerns. 

DC is not immune to these trends. Despite an increase in young professionals, the number of families with young children in the District has declined by 10 percent since 2020, more than double the national rate. This spring, 23 percent of DC’s families said they were considering moving out of the area in the next year.

With the DC Council currently negotiating its budget for the next year, the mayor has proposed cuts to existing policies and programs in the short and longer terms that could push even more families out of the District. Here, we outline how the DC Council could make investments to retain families, preserve and spur economic growth, and set an example for cities and states facing similar trends.

Why are families so important for cities?

Many cities actively recruit young professionals, but families are just as important for cities’ economic stability and growth. Families are more likely to spend money in their local economy (PDF), with child care in particular being a key economic engine. 

Beyond the economic benefits, families also bolster their community. Research has shown that having well-connected, cross-generational communities leads to better health, education, and safety outcomes. 

How DC can support and retain its families

Currently, all levels of government spend little on families compared with other groups. Typically, for every $1 spent on children, the federal government spends $6 on adults ages 65 and older. But spending more on children has proven results. 

More than most cities, DC already provides for children and families. But the proposed budget puts those benefits in jeopardy, and more can be done to keep and attract families as District residents. To make DC more affordable, bolster the city’s economy, and continue serving as an example of family-friendly policymaking, the DC Council could:

1. Stabilize and support child care and early education access and affordability

Nationally, the cost of child care has skyrocketed, rising to $13,128 for a single child in 2024. In DC, the cost of child care sat at $26,193 annually—making it the least affordable in the nation. If DC wants to retain its families with young children, it has to find ways to make child care more affordable, or it risks pushing parents out of the workforce. If that happens, research shows that employers will struggle to fill open positions, the city will collect less in income tax, and families would be less likely to afford cities’ cost of living.

Luckily, DC already has a robust system of supports for child care and early education, but the currently proposed budget puts it at risk. DC’s child care subsidy system served nearly 6,000 children in May 2024. Subsidized care reduces child abuse rates, increases the number of working parents, and better prepares children for preschool and elementary school. In fact, research shows these subsidies generated between $1.70 and $3.00 in the local economy for each dollar invested.

Additionally, DC’s Early Childhood Educator Pay Equity Fund has helped stabilize and improve child care supply. If this funding is cut in fiscal year 2027 and beyond, roughly 340 child care businesses would be affected, risking more than 3,000 educators’ jobs and 19,000 child care slots. Funding cuts may also lead parents to reduce their working hours, pay less in income tax, and move out of the city to avoid paying even more for child care. 

These programs sit alongside DC’s universal prekindergarten initiative, which leads the nation in access and boosts public school enrollment through the early elementary grades—even during the pandemic—by providing free early education for 3- and 4-year-old children. Continued funding for universal prekindergarten across the mixed-delivery system can help retain one of DC’s unique benefits for families with young children.

2. Retain the child tax credit

During the COVID-19 pandemic, the federal government expanded the child tax credit from $2,000 per child to up to $3,600 per child for families. The federal credit was also delivered to low-income families, even if they had low or no earnings. The results were eye-popping; child poverty, food insecurity, and material hardship all fell among recipients. Research found that a permanently expanded child tax credit could boost high school and college graduation rates and increase children’s earning in adulthood.

Although the federal child tax credit expansion expired after 2021, DC recently enacted a district-level credit. The District’s child tax credit would offer up to $420 per child younger than 6. Like the federal expansion in 2021, even families that did not work or had very low incomes could receive the full credit. 

Delivering the credit to all low-income families, rather than increasing the credit alongside earnings, as is typical, would reduce income inequality and food insecurity among DC’s families with children and would offer a good long-run investment. Research shows that every $1 spent on children can have a payoff of $10. Despite the clear benefits to families, current budget proposals would eliminate DC’s child tax credit entirely.

3. Set a foundation of wealth building for the city’s children

In addition to making city life more immediately affordable to families, DC and other city and state leaders must invest in the future of their children. In 2021, DC took a step toward investing in its children with the Child Wealth Building Act, which established publicly funded trust accounts for every child born on Medicaid in the District. Now, the proposed budget seeks to end the program.

The Urban Institute's modeling on early-life wealth building accounts found that when enacted intentionally, these accounts can increase wealth for all racial and income groups, with the greatest effects on the lowest-income families. They also decrease wealth disparities between racial and income groups and the amount of student debt borrowed and the rate at which people borrow. 

With greater wealth and less debt, families are better able to weather emergencies, invest in the future, and ensure economic security for their children. Without this program or an alternative, DC will struggle to support people’s ability to meet today’s needs and secure tomorrow’s opportunities.

Cities must become more affordable places where families can thrive

Federal cuts to the DC budget and mass layoffs lowering the District’s revenue estimates have necessitated that DC reevaluate its spending priorities. But current plans to gut family-friendly programs and policies could backfire.

If DC wants to build on its track record of family-friendly policies, then the DC Council and the mayor will need to make the city more affordable to families. Retaining child care subsidies, universal prekindergarten, the Pay Equity Fund, the child tax credit, and the Child Wealth Fund is a start.

For the city to become an example for the rest of the country, efforts to build more affordable housing, reduce the cost of groceries, and foster a sense of safety and belonging must be pursued to help DC and its families thrive.