Imagine a single area of investment with the power to pay immediate dividends for countless employers and working families across Wisconsin while raising the trajectory of individual well-being and statewide economic health for future generations.
Would you be surprised to learn that these tremendous benefits all result from a thriving early childhood education sector?
Early education is a game-changer. It’s a springboard to success for kids that lasts far beyond the classroom. It’s a necessity for parents to remain active in the workforce. It’s a lifeline for businesses who depend on a robust talent pool that includes the parents of young children.
However, despite every evidence of its universal value, child care is in crisis. With costs rising, availability shrinking and state support limited, the child care market in urban, suburban and rural areas alike is unable to meet the demand, creating significant hardship for families and communities.
- State lawmakers, however, can advance the type of investments that could begin to alleviate the growing emergency and unlock further positive impact for Wisconsin residents. Three key actions could make the biggest difference:
- Finding new sources of public funding to help stabilize early childhood education providers
- Strengthening state subsidies for lower income, working families to help more households afford care
- Advancing policies that increase compensation for early educators to reduce high rates of staff turnover
Philanthropic priority, donor generosity and communitywide benefit
Through philanthropic investments, research, convening activities and our strategic education initiative Milwaukee Succeeds, the Greater Milwaukee Foundation has been prioritizing early childhood education since before the pandemic. Firsthand, we have seen its importance as well as the fundamental fault lines in the sector that have continued to widen, first from COVID and now through ongoing inflationary pressures.
Our Foundation donors have been early adopters of this cause – coinvesting millions of dollars with us to improve access, affordability and quality of early education because whether you directly utilize the system or not, everyone in Wisconsin has a stake in its success.
For the individual child, early education provides developmental rocket fuel that carries forward into K-12 education and beyond. The American Educational Research Association has found that participation in high-quality care reduces special education placement by 8.1 percent and increases high school graduation rates by 11.4 percent. Overall, children with access tend to have enhanced educational attainment, improved career options in adulthood, higher earnings and better health outcomes, per the National Bureau of Economic Research.
For our community socially, the positive effects of early education are multi-generational, contributing to health, safety and well-being. Economist and Nobel Laureate James Heckman has found that the children of those who received high-quality child care are more likely than other children to complete high school without suspension, to be gainfully employed and to never have faced arrest or addiction.
And for our community economically, the impact can’t be ignored. Ready Nation has estimated Wisconsin loses $1.9 billion a year in economic productivity due to child care issues. Meanwhile, Wisconsin’s Department of Children and Families found that 78 percent of surveyed business owners agree that the state’s economy is impacted by families’ ability to access affordable, high-quality child care.
With the evidence overwhelmingly in its favor, why isn’t high-quality early childhood education plentiful and flourishing? The answer is that the sector’s business model is flawed, creating an untenable situation where parents can’t afford care, providers can’t afford staff or rising operational costs, and staff can’t afford to stay in the profession.
Our collective opportunity now is to pursue innovative options for infusing more public and private funding into the child care sector. We believe the proposed solutions are a step in the right direction.
Solutions for an urgent challenge
Finding new sources of funding at the state level would help stabilize the industry and avert a looming cliff of provider closures, keeping parents in the workforce and the economy growing. More than 34,000 infants and toddlers in the state currently lack access to safe, regulated care. Local research by Milwaukee Succeeds also found that care providers have been using most pandemic relief dollars for basic operating needs like rent, food and supplies. Nearly one in six of the 663 providers surveyed said they expect to close when the funds expire in June. The price of inaction is high.
Strengthening the Wisconsin Shares subsidy program would help make early childhood education more affordable for more people. Families in Wisconsin pay the highest co-payments on child care subsidies in the country – up to 17 percent of their household income for a family of three, compared, for example, to 5 percent in Minnesota and 5.7 percent in Michigan. Considering the average annual cost for one infant at a child care center is over $11,900, according to the Department of Children and Families, our goals should include reducing family co-pays, expanding access, increasing eligibility, and simplifying the application process.
Advancing policies to increase early educator pay would help reduce high rates of turnover in the field. Although research commissioned by the Department of Children and Families shows nearly 83 percent of early education teachers have some college education or a college degree, their average wage is about $12.99 per hour. Poverty-level pay leads to low recruitment and retention, and often, classroom closures. A living wage, however, is a catalyst for more consistent staffing, and therefore greater access to care for families.
For all of Wisconsin
Access to early childhood education affects kids and families across the state, from the biggest cities to the smallest towns. The workforce implications affect employers of every size and industry. Stabilizing this critical sector is good for our economy and the quality of life in our communities long term.
The challenges before us, however, are complex. To develop practical solutions at the scale needed to work for communities spanning Wisconsin, we need to work together across geographic borders and across sectors.
That is why the Foundation seeks and convenes broad, dynamic coalitions with partners throughout the state whose stakeholders represent a comprehensive cross-section of the community including parents, providers, government, business leaders, donors, other funders and concerned residents. I commend those who have joined us to seek positive change together in a unified voice.
More information about prioritizing child care and early literacy through public policy is available on our website.
Our hope is that we may all share a vision for our state where high quality, affordable early childhood education is the standard that all families, businesses and children can expect.
Gregory M. Wesley, JD
President and CEO
Greater Milwaukee Foundation