Businesses Leaders See Major Economic Boost in NY by Expanding Child Care and Pre-K
New study says investments in early care and education increase business sales, create jobs and improve the workforce
Albany, N.Y. (March 11, 2010) — Investments in child care and pre-k provide a surprisingly big boost to local business sales and are critical in helping New York recover from the current recession, a group of prominent business leaders shared with state legislators at a news conference today.
Business leaders John C. Cavalier, F. Michael Tucker and Jeff Goronkin cited a new report by the national business group America’s Edge, of which they are members, showing that investing in early care and education dramatically increases local business sales, creates jobs and also produces long-term economic growth.
The report shows that for every $1 invested in early care and education in New York, $1.86 is generated in additional spending within the state. This strong economic boost for local businesses is highly competitive with the results of investments in other major sectors such as construction ($1.86), retail trade ($1.83), manufacturing ($1.72), transportation ($1.72) and utilities ($1.53).
“Business leaders are sending a clear message to Albany: investing in early education is essential for economic development in New York. The early care and education sector is an often-overlooked area that will immediately boost the economy and create long-term economic security. Legislators should take this into account as they make tough budget choices this year,” said John C. Cavalier, retired Chairman and CEO of MapInfo, a prominent mapping software company that uses geographic information for business development purposes.
“The findings of this report make it clear that investing in early care and education is an essential strategy for getting New York’s economy moving again during a difficult time,” said F. Michael Tucker, president and CEO of the Center for Economic Growth, an Albany-based business development group representing nearly 300 member organizations. “On top of the educational benefits of early learning, these investments also provide immediate economic relief to local businesses in every economic sector, helping firms stay in business and generating more buying power for consumers. Our state legislators need to know these facts.”
“With limited funds available to help businesses and our economy get back on track, few investments make as much sense for our children’s future and local businesses’ balance sheets as expanded investments in high-quality early care and education,” said Jeff Goronkin, President and CEO of social media venture iZoca.
The report notes that if all New York children were given access to quality early care and education, at a cost of an additional $3.6 billion, the state would generate $6.7 billion in total new spending in New York businesses. Nearly all of the dollars generated in New York would stay in New York – maximizing the benefits for local businesses and communities, while also creating up to 80,000 new jobs, including 17,000 jobs outside the early learning sector.
Fully investing in child care and pre-k would boost sales for hundreds of different types of businesses ranging from restaurants and local electric companies to supermarkets and clothing stores. The report notes several examples of increased sales in specific business including:
- $113 million in sales at local restaurants, the cost for over 25,000 households of four to eat out for one year,
- $80 million in sales from local electric companies, the cost of monthly electric bills for nearly 50,000 families, and
- $29 million in sales from local supermarkets, the cost of a year of groceries for over 5,000 families.
Investing in early learning would also save New York businesses money every day through reduced absenteeism and turnover and would help increase the ability of New York businesses to attract skilled employees and new businesses. Quality early care and education programs allow working parents to be attentive to their jobs rather than worry about day care arrangements.
The report is based on 2008 data for New York from IMPLAN, an economic modeling system widely used by economists conducting economic impact and related analyses.
“The methodology used in the report is sound, and the findings are important,” said Dr. Eric Thompson, PhD, Professor of Economics and Director of the Bureau of Business Research at the University of Nebraska, an expert on the economic analysis used in the report. “Many legislators in New York may be surprised to learn that investments in quality early care and education have immediate, very positive economic benefits.”
“High-quality early education more than pays for itself over the long term,” said Lori King-Kocsis, New York Director of America’s Edge. “Rigorous research of high-quality early education programs for at-risk children has found that these programs deliver as much as $16 for every $1 invested due to decreased crime, special education and other costs.”