Report: Investing in high-quality early childhood programs would yield strong returns & deliver significant benefits to Vermont’s economy
Every additional dollar invested would yield a $3.08 return
The VBR Research & Education Foundation (VBR Foundation) released a report today, titled Vermont’s Early Care and Learning Dividend, which details the Vermont-specific return on investment the state stands to gain by increasing public funding for high-quality early care and learning programs.
“Numerous national studies have shown that investments in early childhood yield strong returns. Our report looked at what those returns would look like in Vermont. What we found is that every additional dollar Vermont invests to expand high-quality early care and learning programs would yield a return of $3.08,” said Lisa Ventriss, president of the Vermont Business Roundtable.
While many national studies that have found high returns for investments in early childhood have focused on high-risk children, this report utilizes a more holistic approach and is based on providing high-quality, affordable early care and learning programs to Vermont’s youngest children as a whole.
The report, which was compiled by Wilder Research on behalf of the VBR Foundation, stems from recent work conducted by Vermont’s Blue Ribbon Commission on Financing High Quality, Affordable Child Care. According to the Commission’s final report issued in December, more than 70% of children under age 6 in Vermont have all available parents in the labor force. This means that there are approximately 21,670 children under age 5 likely to need some form of child care. Yet almost half of Vermont infants and toddlers likely to need care don’t have access to any regulated child care programs and almost 80% don’t have access to high-quality programs.
The Blue Ribbon Commission found that after accounting for parent contributions and current public funding, the state would need to increase investments in Vermont’s early care and learning system by $206 million to achieve an equitable, affordable, and high-quality early care and learning system that met the needs of children birth to five who have all available parents in the labor force. Vermont’s Early Care and Learning Dividend examined the economic benefits that would be generated if the state made this level of investment in Vermont’s early care and learning system.
“Our report found that enacting the Blue Ribbon Commission’s recommendation of a high-quality, affordable early care and learning system would yield net benefits to Vermont’s economy of $22 million a year. These benefits would continue to accrue over the working lifetime of the children receiving that care, totaling $1.3 billion over the next 60 years,” Ventriss said.
In the short-term, economic benefits would include increased parent participation in the workforce, increased workforce stability and supply for businesses, and decreased spending on special education services for children as they move from high-quality early care and learning programs into the public school system.
In the long-term, high-quality early care and learning experiences have been shown to translate into tangible benefits for children and the economy. These include higher educational attainment, increased earning potential, lower incarceration rates, and stronger health outcomes.
All study results are based on Vermont-specific data sets. The study examines economic and social benefits of increased public investments in Vermont’s early care and learning programs including:
- Savings for Vermont’s government through its K-12 public education system through reduced special education costs and reduced grade retention;
- Savings for Vermont’s justice system;
- Additional tax revenues;
- Reduced future health care costs paid by the government;
- Benefits to participating children, including additional net lifetime earnings and reduced future health care costs; and
- Benefits to other members of society via reduced cost to victims of crime and reduced health care costs accrued by other private payers.
The study’s advisory group, included members from the VBR Research & Education Foundation, Vermont Business Roundtable, Vermont Businesses for Social Responsibility, and the Permanent Fund for Vermont’s Children.
Tom MacLeay, Treasurer of the Board of Directors for the Permanent Fund for Vermont’s Children and former CEO and current Chair of the for National Life Group Board, served on the study’s advisory group. “As a former CEO for one of Vermont’s largest employers, I understand the economic consequences of our state’s shortage of high-quality, affordable child care. As our working-age population continues to decline, Vermont businesses struggle to attract and retain skilled workers because parents can’t find child care,” MacLeay said.
Governor Phil Scott announced his intention to increase funding into the early childhood system by $9.6 million. At a Feb. 1 event, Scott told members of the Vermont Early Childhood Business Council that these investments in early childhood are “critical and crucial.” “We need to support Vermont’s current workforce with significant investments to make child care more affordable, while supporting our future workforce to reach their maximum potential,” Scott said at the event.
The full report may be viewed and downloaded here: http://vtroundtable.org/wp-content/uploads/sites/31/2017/02/VermontECLDReport_2017.pdf.
The Vermont Business Roundtable is a nonprofit, nonpartisan organization of CEOs from Vermont’s top private and nonprofit employers, representing geographic diversity and all major sectors of the Vermont economy and employing more than 10 percent of the state’s workforce. The Roundtable is committed to sustaining a sound economy and preserving Vermont’s unique quality of life by studying and making recommendations on statewide public policy issues.
The VBR Research & Education Foundation works to ensure a continuum of high quality educational experiences to prepare children and families to be productive citizens in a global economy (from prenatal through post-secondary and higher education).
UPDATED 3.6.17: Informative one-page handout available for download here: VermontROI_VBR_Handout_Web