Top Picks

When child day-care centers were just starting out with tentative baby steps some 30 years ago, American families were less than enthusiastic about them-most kids were still cared for by a parent or relative, and only one in 20 children was in day care. In recent years, however, those figures have undergone a dramatic change: Of the 20 million children in the nation under age 5, one in three is cared for in part at a day-care center. "What this means is that the middle class has accepted [day-care] centers as a normal part of the social fabric," says Roger Neugebauer, publisher of Child Care Information Exchange, a trade publication that tracks the industry.

That's good news for entrepreneurs hoping to latch onto success in one of the nation's fastest-growing industries. And that trend should persevere: The number of women entering the work force continues to rise; 4 million babies are born each year; and day care is still the number-one choice for parents, despite its average $4,000 per year/per child cost, according to the Children's Defense Fund, a nonprofit child advocacy organization.

To succeed, centers must offer more than just child's play. Recent brain research supports the importance of stimulation and development in the first six years of life. In addition to providing an educational environment for toddlers, today's day-care centers offer expanded services: More and more have extended their hours to include evenings and weekends, and many are taking education beyond preschool age and teaching elementary grades.

But with a dearth of qualified workers, entrepreneurs face the challenge of acquiring a staff prepared to meet the public's demand. "The 18- to 26-year-old age group in the population is shrinking, and that's where we get 90 percent of our teachers," says Neugebauer. Nonetheless, experts predict a market growth rate of 5 percent to 10 percent over the next five years. Here's looking after you, kids.

This article was originally published in the December 1997 print edition of Entrepreneur with the headline: Top Picks.