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Jefferson and Hardin Counties, Kentucky: Economic Impact of the Child Care Industry in Jefferson & Hardin Counties

Project status

Completed June, 2004

Lead Agency

4C:  Community Coordinated Child Care

Contact Person

Janet S. Masterson, Assistant Director
Community Coordinated Child Care
1215 South Third Street
Louisville KY 40203

Research Firm

National Economic Development and Law Center


  • Number of Establishments
  • Child Care Labor Force
  • Children Served
  • Gross Receipts


  • Long Report (15+ Pages)
  • Newspaper Article / Media Coverage
  • Conducted a Series of Presentations
  • Sent Out an Outreach Letter
  • Involved Business / Economic Development

Case Study

Case Study: Jefferson and Hardin Counties, Kentucky
“The Economic Impact of the Child Care Industry in Jefferson and Hardin Counties”
Date of Study Completion: June, 2004



Community Coordinated Child Care (4-C) was the lead organization in this study and contracted with the National Economic Development and Law Center (NEDLC) to conduct the research and write the report. An Advisory Council was created to help guide the study and forge new partnerships. The Council was made up of representatives from large and small businesses, business organizations such as the Small Business Development Center and the Main Street Business Association, government officials, the United Way , child care and family services organizations, and the Kentucky State Data Center .


Staff of the of 4-C attended the National Association of Child Care Resource and Referral Agencies (NACRRA) conference where they learned of the economic impact studies completed in other regions. The main goal of the study was to bring non-traditional partners, specifically the business community and policy makers, into the investment pool for child care. A secondary goal was to inform and network child care providers. In 2000 the Kentucky Department of Education initiated the Kentucky Invests in Developing Success (KIDS) Now initiative which provides a number of different support programs for early care and education, including a voluntary rating system for child care providers. This program fostered an environment which supported the initiation of a study. Though ideally the study would have been performed at the state level, funding constraints prevented their ability to do a large study and instead they chose to focus on two of the state’s counties: one large and urban ( Jefferson County ), one small and rural ( Hardin County ). Both counties are economic engines and job magnets for the larger Louisville Economic Area which spans 16 counties in Kentucky and 7 counties in Indiana .

The Study:

Sector Definition

Because Jefferson County has the 16th largest school system in the US, its Head Start and pre-K programs are heavily subsidized. Therefore, the study chose not to include these programs in their analysis and instead to focus on programs that are primarily funded by parent fees and licensed by the state. They define child care as including full-day and part-day child development programs for young and school age children, such as licensed child care centers and family child care homes. Unlicensed care is excluded because of the difficulty in tracking it.

Data Analysis

Measurement* Hardin County Jefferson County
Number of Establishments 117 663
Child Care Labor Force 438 3,840
Children Served 3,859 28,157
Gross Receipts $14.9 million $119.8 million
Number of Parents with Children in Paid Care    
Multiplier Effects on Local Economy X X
Governmental Transfers / Subsidies X
Tax Receipts / Fiscal Impact    

*Not all studies included the same components making it difficult to compare the numbers provided in this chart with those of other studies. In its definition of the number of establishments, this study included licensed and regulated center and family care, and did not include pre-K in public schools or regulation-exempt home-based care (informal care). In its definition of gross receipts, this study included provider charges (parent fees and vouchers in lieu of parent fees), and did not include government funded programs (Head Start, Pre-K) or provider subsidies (quality dollars, Child and Adult Care Food Program, etc.)

Notably, Kentucky’s study explored data on the commuting patterns of employees in these counties, the impact of lengthy commutes on child care centers that operate during nontraditional hours and the need for incorporating child care in transportation planning.

Additionally, the study explored data on the wage needed for self-sufficiency, and therefore independence from government subsidies, in these counties. The study revealed that the self-sufficiency wage requirement is not met by the majority of jobs in the study counties (see Unique Findings for results).

The study’s initiators found it difficult to shift their thinking to the economic value of child care due to their lack of experience with how to measure an industries’ impact on the local economy. Their partnership with NEDLC, and the incorporation of a data specialist on their advisory board, helped overcome this challenge.

Unique Findings

  • In Jefferson County, the child care industry employs more people than other major industries in the county. In Hardin County there are more child care professionals than public elementary school teachers and staff.
  • In Jefferson County, almost 81,000 children ages 0-12 need some form of care. In Hardin County, 11,000 children need some form of care.
  • Over 54% of jobs in the Louisville Economic area, the broader region encompassing both Jefferson and Hardin counties, as well as 21 other counties, pay less than Louisville’s self-sufficiency wage for a single adult with a preschooler ($14.22/hour)


Organizational Change and Outreach

The Mayor of Jefferson County was a key spokesperson at the roll out and soon became a champion of child care as a result. He has even increased the support of child care benefits for government employees and has approached 4-C with a request for a letter to use to engage national policy makers in a discussion about funding child care. The Chief Operating Officer of the Jefferson County Chamber of Commerce also spoke at the roll out and was a tremendous help in sharing the message of the report with the business community.

Through this newly formed partnership with the Chamber of Commerce, a program is in progress that will help to educate businesses about the positive return on investment that can result from effective work-life policies. In addition, three sub-groups of the original advisory committee have been formed to work on recommendations from the business sector, government, and community about how to improve support for child care.

4-C combined their roll out with an already popular event: their Child Care Provider Appreciation Dinner. Over 300 people attended and both the Mayor of Jefferson County and the Chief Operating Officer of the Jefferson Chamber of Commerce spoke. The story of the studies’ completion was also published on the front page of the Jefferson County Business Journal, and in local newspapers.


Though there are many benefits to performing a study on the local level, the Kentucky study team found that this approach limited their ability to make policy recommendations. The authors would have preferred a statewide analysis that led to statewide policy recommendations. However, the study makes four primary recommendations:

  1. Link Child Care and Economic Development by: incorporating child care into city comprehensive plans; drafting tax credit legislation in support of child care; establishing child care friendly zoning regulations, and integrating of child care into transportation planning.
  2. Involve Businesses and Banks in the Child Care Industry by: providing incentives for businesses and financial institutions to invest in child care.
  3. Enhance the Quality of the Existing Child Care Infrastructure by: establishing quality improvement programs; funding workforce development; establishing designated government liaisons who work with the child care industry; and, integrating the existing child care infrastructure into universal pre-school.
  4. Improve the Affordability and Accessibility of Child Care by: encouraging employers to establish flexible spending accounts, and exploring non-traditional funding streams such as the motor vehicle tax and federal grants for campus-based child care.

Interview with:
Janet Masterson, Assistant Director
Susan Vessels, Executive Director
Community Coordinated Child Care , 4-C
July 14th, 2004


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