Economic Impacts of Early Care and Education in California

Source: Jenifer MacGillvary and Laurel Lucia, University of California, Berkeley Center for Labor Research and Education, August 2011

Early care and education (ECE) is an important industry in California, serving more than 850,000 California children and their families and bringing in gross receipts of at least $5.6 billion annually. The industry not only benefits the children who receive care, but also strengthens the California economy as a whole, which is especially important during this time in which California is struggling with high unemployment and a weak economic recovery. This paper discusses the range of economic benefits that the ECE industry brings to California.

Our review of the research finds that the ECE industry benefits the California economy by promoting and facilitating parents’ ability to participate in the paid workforce. Research has found that high-quality and reliable child care increases worker productivity and improves businesses’ bottom line. Access to ECE reduces absenteeism and decreases turnover. ECE is especially important to the careers and earnings of mothers. Parents’ ability to pursue education is also tied to the availability of ECE.

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