The rate of return on a good early-childhood program is about 13 percent, according to a new analysis from the labor economist and Nobel laureate James Heckman, who directs the Center for the Economics of Human Development at the University of Chicago. That’s a higher return than the 7 to 10 percent that has often been associated with preschool programs. And, as Heckman noted during a call with reporters recently, that’s also a better deal than many stocks.
Past research has typically focused on programs that serve 3- and 4-year-olds, and researchers have often focused narrowly on specific benefits (say, academic performance) and limited timeframes (say, third grade). Heckman thinks those approaches are shortsighted. In actuality, he and several colleagues at the University of Chicago and the University of Southern California argue, when a range of factors are taken into account over a long span of time, quality early-childhood programs that begin at the very beginning of life may offer greater benefits than previous research has indicated.
They set out to estimate the long-range benefits of a couple of very similar, high-quality programs from the 1970s that served mostly low-income, African American children. They selected the programs—the Carolina Abecedarian Project and Carolina Approach to Responsive Education—because they’ve served as blueprints for others around the world, including the highly regarded Educare.
The programs focused on early-language, motor, and cognitive development, as well as social-emotional skills like the ability to concentrate on a project. The curriculum emphasized active experiences such as play, and was tailored to each child’s abilities.
Babies, who were referred by hospitals and local agencies, started the program early, after about 8 weeks of life, and attended 50 weeks a year from 7:45 a.m. to about 5:30 p.m. five days each week, meaning the centers effectively doubled as daycare. Right now, childcare and early-childhood education are often studied separately, Jorge Luis Garcia, a research assistant at the center Heckman runs, said during a phone interview. But as the number of single mothers rises, he said, and the need for childcare increases, it’s increasingly important to consider how quality childcare that begins at birth and also educates children could positively influence women’s participation in the workforce and help their families over time.
Researchers checked in with participants regularly through age 35 to see how they were faring. They looked not only at IQ and education level, but also at their health, their income, their criminal records, their overall quality of life, and whether their participation in the program increased their mothers’ earnings (an important factor because most of the children grew up with single mothers).
For every dollar spent on early-childhood education, the researchers found a benefit of about $6.30. And crucially, they found benefits across the board, from health to education, with some variation between men and women. (They acknowledge that they are limited by the fact that they cannot measure the potential benefits families derive when parents stay home and the fact that women are more likely to stay home.)
Ultimately, the team found that employment at age 30 increased between 7 and 13 points for women who participated in the programs, and between 11 and 18 points for men, compared to people who attended a lower-quality alternative or stayed at home. The researchers found that placement in a low-quality alternative was more damaging for boys than for girls. Men also seemed to derive more physical health benefits, while women seemed to benefit more across a range of mental-health measures.
Unlike most other studies on the topic, the researchers predicted the lifetime health benefits of the programs. “We’re measuring something that hasn’t been measured before,” Heckman said. To do that, his team relied on a model developed by Dana Goldman, the director of the Schaeffer Center for Health Policy and Economics at USC.
Many people in the research community shy away from trying to make such predictions, Goldman said during a phone conversation, but he thinks difficult questions about long-term outcomes are “the most important.” People who want to build bridges or other infrastructure know they need to look at returns 50 or 100 years in the future to make an intelligent investment, he said. Yet when it comes to kids and developing policies and programs around them, he noted, most people only look a decade out because of supposed data limitations. It “doesn’t make any fiscal sense,” he continued.
Beyond the attempt to measure the overall lifelong benefits of good early-childhood education programs, Heckman’s latest work is important in that it also measures and quantifies a range of benefits, showing that no single factor drives the overall gains. “The totality of evidence is very unassailable,” Goldman said of the final report.
The authors acknowledge that critics have pointed out that the program costs are high, about $18,514 per year per participant in 2014 dollars, but say “so are the benefits, which far outweigh the costs,” even when such programs are funded through public revenue. Heckman also pushed back at other studies that have suggested the benefits of preschool dissipate in elementary school. It’s a “titillating” idea, he said, but he doesn’t think the research is sound, in part because of problems with randomization, and, he added, such studies rarely consider long-term data.
The researchers wrote in the study that they hope their methodology will serve as a template for scholars looking to evaluate other programs. Studies attempting to measure impact are frequently siloed, Heckman said, meaning they just look at academics or they just look at crime. Heckman hopes the study gives policymakers debating how to support working parents and struggling families a better sense of the range of benefits of such programs.
Right now childcare costs and quality vary wildly. A recent report from Child Care Aware of America found that the average cost for center-based care is above 10 percent of what a married couple with children is likely to earn in 39 states and Washington, D.C. For infants, the cost can be above $17,000 per year, which is more than what many public universities charge for tuition.
Yet, Heckman and his co-authors argue, child poverty is growing, and investing in programs that begin at the earliest stages of life and last through entry into kindergarten could be a good way to limit its consequences. But the programs need to be high-quality, meaning kids should receive individualized attention that is developmentally appropriate. Heckman said that warehouse-type centers, where lots of kids are largely left to their own devices all day, “can lead to even harmful consequences in terms of social-emotional development.”
The fact that the programs his team studied lasted for so many hours each day and weeks each year helped increase the social mobility of low-income families by giving mothers, many of them sole breadwinners, the chance to work. Good programs, Heckman said, “operate in a way of supplementing family life.” He praised programs that encourage and model strong adult-child relationships and interactions, especially for parents who may not have grown up with such bonds.
Policymakers are so focused today on preschool programs that start at age 4, Heckman said, when important brain development is taking place in infancy. He lamented that politicians seem to be fixated on certain evidence showing the benefits of such programs when other data suggests programs that start earlier have higher rates of return. “It’s too bad that public discussion’s kind of ossified,” he said. In the next few years, Heckman said he plans to study how benefits change depending on when children begin programs.
He also criticized the idea that need is often equated with income. In the broader debate over whether programs should be universal or targeted, he suggested that targeting the neediest families is most effective, but specified that need has more to do with children who suffer from a lack of engagement than with straight income. Heckman’s not against universal-preschool programs, but said they should be structured so that wealthy families pay more to ensure that public money is spent where it “will have the highest economic return.”
“We know we can go forward,” he said, adding that high-quality programs hinge on having trained staffers who respect and pay attention to kids. It requires, he said, “a kind of human empathy” from everyone involved.
This story is part of our Next America: Early Childhood project, which is supported by grants from the Annie E. Casey Foundation and the Heising-Simons Foundation.