Investing in Early Childhood Pays Off Big Time

New research shows that investing in early childhood programs yields not only social bene!ts, but !nancial ones. Graduate student and research assistant on the Research in Early Child Development Initiative, Gabriela Arias de Sanchez, has conducted an extensive literature review that

demonstrates the economic bene!ts of investing in early learning and childcare (ELCC). Arias de Sanchez has discovered that for every $1 invested in ELCC programs, society nets a minimum $3 return (Van der Gaag, 2002). ese economic bene!ts can truly affect policy makers and the structure of early learning and childcare.

Economic Bene"ts of ELCC Investment• Reduction in Criminal Activity: In Canada, the

estimated cost of poor ELCC is $120 billion a year in crime and violence, and $100 million a year in mental health behaviours and drug use (Mustard, 2008).

• Gains in maternal employment: In Quebec, where childcare reforms are estimated to have increased mothers’ employment by 8%, a 40% return has been realized through income taxes from the increased labour force participation (Child Care Advocacy, 2008).

• Gains in learning outcomes: James Heckman, a Nobel prize winner in economics, has calculated the return on investments in primary and secondary education to be about 3:1 in contrast to at least 8:1 for ELCC programs (Heckman & Cunha, 2000).

• Reduction of Services: Quality ELCC leads to a reduction of both special needs services and social services during the school years.

• Increased productivity: A Swiss study showed that publicly funded childcare resulted in higher productivity and earnings due to employee satisfaction/retention, higher !nancial contributions to social security/savings plans, and less dependency on social assistance (Muller-Kucera & Bauer, 2001).

As Arias de Sanchez repeatedly read, “investment in the early years will have a substantial long-term economic gain for society” (McCain & Mustard, 1999). If these investments are implemented, and “if properly linked to labour, health, and social services, early childhood programs can deliver additional outcomes such as enhanced maternal employment, less family poverty, better parenting skills, and greater family and community cohesion.” If more public spending is targeted toward childhood programs, society will see returns that “outstrip any other type of human capital investment” (McCain & Mustard, 1999).

Baker, M., Gruber, J., & Milligan, K. (2006). What can we learn from Quebec’s universal child care programs? Retrieved from http://action.web.ca/home/crru/ rsrcs-full.shtml?x=86566Heckman, J. & Cunha, F. (2000). Policies to foster human capital. Joint Centre for Poverty Research (Working Paper N 154). Northwestern University: University of Chicago.McCain, M. & Mustard, F. (1999). Early years study. Final report. Reversing the real brain drain. Ontario Children’s Secretariat. Toronto: Publications Ontario.Muller-Kucera & Bauer (2001). Costs and bene!ts of childcare services in Switzerland. Empirical !ndings for Zurich. In L. Mitchell, C. Wylie, & M.Carr (Eds.), Outcomes of ECE: Literature review. Report to the Ministry of Education. Research Division: New Zealand. Mustard, F. (2008). Early child development and vulnerable children. Institute for Research on Public Policy Symposium. Vulnerable Children in Canada: Research and Policy Options. Van der Gaag, J. (2002). Child development to human development. In M.E. Young (Ed), From early child development to human development. Washington: e World Bank.

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