Contra Costa County, California: The Economic Impact of the Child Care Industry in Contra Costa County

Project status

Completed January, 2003

Lead Agency

Contra Costa Child Care Council

Contact Person

Kate Ertz-Berger
Executive Director
(925) 676-5442
kate@cocokids.org

Research Firm

National Economic Development and Law Center
2201 Broadway
Suite 815
Oakland, CA 94612
(510) 251-2600
(510) 251-0600 fax
jen@nedlc.org

Measurements

Number of Establishments
Child Care Labor Force
Children Served
Gross Receipts
Number of Parents with Children in Paid Care
Multiplier Effects on Local Economy
Governmental Transfers / Subsidies
Tax Receipts / Fiscal Impact

Additional Information

Note: This study is an update of the 1997 Contra Costa study.

Case Study

Case Study: Contra Costa County
“The Economic Impact of the Child Care Industry in Contra Costa County”
Project web site: http://www.cocokids.org
(The full report is not available on the web)
Study Publication Date: January 2003

Initiation:

Membership

The study was initiated by Contra Costa Child Care Council (CCCCC) and written by the National Economic Development and Law Center (NEDLC). Additional insight and feedback was solicited through the establishment of a diverse advisory committee representing a broad cross-section of the community. The committee included representatives of the child care sector and two countywide business associations, the central labor council, county welfare department, workforce development board, and local hospital council. The President of the local community college, as well as a Dean from the State University , also participated in the advisory committee.

Context

While the State of California is experiencing a severe deficit, unique support systems for child care have been in place for many years. For example, the First Five Initiative mandates that a percentage of proceeds from the sales of cigarettes fund services for children and their families ages 0-5. Contra Costa County receives a total of about $12 million per year from this fund to distribute to a variety of programs including child care. Additionally, some local planning codes require developers to incorporate child care into their plans. However, given the current economic climate and the growing demand for quality early care and education, the Contra Costa Child Care Council recognized the need for a tool to engage new partners in supporting child care and to promote its support over the long term.

The Study:

Sector Definition

The report analyzed only licensed care, including regulated large and small family child care homes and regulated child care centers. Most Head Start programs are included in licensed care, however regulation-exempt center-based child care (such as school-operated part-day preschool programs and private, part-day nursery schools) are not included.

Data Analysis

Measurement*	Contra Costa Co.
Number of Establishments	1,815
Child Care Labor Force	4,757 full-time equivalent
Children Served	29,695
Gross Receipts	$231.4 million
Number of Parents with Children in Paid Care	10,176 married couples + 3,486 single parents
Multiplier Effects on Local Economy	X
Governmental Transfers / Subsidies	X
Tax Receipts / Fiscal Impact	X

* Not all studies included the same components making it difficult to compare the numbers provided in this chart with those of other studies. This study included licensed and regulated center and family care but did not include regulation-exempt care. (Most Head Start programs are included in licensed care, however school-operated part-day preschool programs and private, part-day nursery schools are not included. Additionally, informal, home-based care provided by relatives, nannies or babysitters is not included.) In its definition of gross receipts, this study included parent fees, provider subsidies (quality, CACFP), and government funded programs (Head Start and education department funding.)

Data Challenges:

The author of the report cited no specific data challenges. The Contra Costa Child Care Council, a CCR&R agency, is required to keep current, accurate data on child care capacity, enrollment and price. These data were used to estimate gross receipts. Additional data on overall economic conditions was obtained in partnership with NEDLC, which had experience in data collection for economic studies.

Unique Findings:

It is estimated that by the year 2010, 85 percent of the workforce in Contra Costa County will be parents.
Contra Costa' strong population growth creates a challenge for the entire education system, including traditional school ages and children 0 to 5.
The increasing demand for skilled Spanish speakers results in a limited number of Spanish-speaking child care professionals.
The County's strong service and retail sectors contribute to a greater demand for child care during hours outside of the traditional 8 am-6 pm child care schedule.
High housing costs continue to shrink the portion of a family's income available to pay for child care.
Because of the high number of children in poverty in Contra Costa, child care programs continue to experience excess demand for subsidized slots.

The report includes a table of the various sources of child care subsidies, as well as the multiplier effect of child care capital investments—e.g., the number of jobs created by investments in child care construction.

Like other studies, the Contra Costa report estimates the collective earnings of working parents who use licensed child care. However, this study goes even further and estimates the economic output of working parents in terms of: county industry output, value added to the county gross product, indirect county tax revenues, property income and county jobs.

Impacts:

Organizational Change and Outreach

The report was mailed with a letter signed by the Chairman of the Board of Supervisors and other representatives of the business community to over 20 business leaders in the county asking recipients to make time for a meeting. A consultant followed up with each business and met one-on-one with these business leaders. These meetings were followed by an all-day summit titled “The Business of Child Care”. The summit kicked off with a breakfast for business leaders. Speakers at the breakfast included the Chairman of the Board, and Abby Thorman, Director of the Kansas Metropolitan Council on Child Care of the Kansas study. Twenty-five businesses attended the breakfast and of these, eighteen signed up to continue work on this effort.

The report also has been presented to a number of groups including the Board of Supervisors and the City Council.

The business community was engaged throughout the study and the Executive Director of CCCCC is now active on the Contra Costa Council Business Association’s education and workforce development committee.

The report has contributed significantly to the Champions for Children initiative which is a 10-year public engagement campaign with a goal of building a system of early care and education in Contra Costa County that is unsurpassed.

Policy

The Contra Costa study recommends an increase in subsidies for low-income families, an overall increase in government investment in child care, and the incorporation of child care in economic development planning. Specifically, the study recommends that child care be implemented in every General Plan within the county.

Interview with:
Kate Ertz-Berger
Executive Director
Contra Costa Child Care Council
Summer, 2004