Study shows high quality childcare delivers great benefits
High quality birth-to-five year old programs for disadvantaged children can deliver a 13 per cent year return on investment, according to a study from the University of Chicago.
Prof James Heckman and colleagues found the rate on investment was substantially higher than the seven to 10 per cent return previously established for preschool programs serving three to four year olds.
He found the significant gains were realised through better outcomes in education, health, social behaviours and employment.
In the study The Lifecycle Benefits of an Influential Early Childhood Program, by Prof Heckman, Jorge Garcia, Duncan Leaf and Maria Prados, data was collected on two groups of controlled preschool experiments in North Carolina.
From birth to eight years old, data was collected annually on cognitive and socio-emotional skills, home environments, family structure and family economic characteristics.
After age eight, data on cognitive and socio-emotional skills, education and family characteristics were collected until the age of 30.
The study found children who received centre-based care had significantly better life outcomes than those who did receive centre-based care, or those that received low quality care.
For girls, involvement in centre-based care had positive effects on high school graduation, years of education, adult enjoyment and the adult labour incomes of participants and their parents.
The results for boys revealed lower drug use and blood pressure, and positive effects on education and later labour income.
The study found that because the children were in high quality care for more than nine hours a day, parents, or more specifically mothers, were able to increase their education, labour force participation and parental income.
For every dollar spent on the high quality program, called ABC/CARE, a 13 per cent per annum return on investment was seen.
Prof Heckman’s study stated “investing in comprehensive birth-to-five early childhood education is a powerful and cost-effective way to mitigate the negative consequences (of poverty) on child development and adult opportunity”.
“The cost of inaction is a tragic loss of human and economic potential that we cannot afford.”
For more on the Heckman Equation, visit http://heckmanequation.org/