Larimer County, Colorado: Economic Impact of the Early Care & Education Industry in Larimer County
Project status
Completed Summer 2003
Lead Agency
Larimer County Early Childhood Council
Contact Person
Wendy Watson
Early Childhood Council of Larimer County
P.O. Box 271708
Ft. Collins, CO 80527
970-231-9756 (cell)
970-278-1383
ECC@frii.com
Research Firm
BBC Research & Consulting
3773 Cherry Creek N. Drive, Suite 850
Denver, CO 80209-3827
http://www.bbcresearch.com
bbc@bbcresearch.com
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
Outreach
- Long Report (15+ Pages)
- Stand-Alone Executive Summary/Brochure
- Newspaper Article / Media Coverage
- Conducted a Series of Presentations
- Involved Business / Economic Development
Case Study
Case Study: Larimer County, CO
“Economic Impact of the Early Care & Education Industry in Larimer County”
Date of Study Completion: July, 2003
Initiation:
Membership
The Larimer County study was conducted by BBC Research & Consulting in conjunction with the Boulder County, CO study. In addition, members of the Early Care and Education Shared Vision Initiative of Larimer County and Boulder County gave assistance and input to the study, and in particular coordinated data collection. The Shared Vision Initiative is a joint undertaking by the Early Care and Education Childhood Councils of Larimer and Boulder Counties , which has the goal of creating a shared vision of child care and preschool education as a community priority. The study was funded by the Colorado Department of Education. Members of the business and economic development communities were not directly involved in the collaboration, although the research team came from the University of Colorado at Boulder School of Business.
Context
Since 1997, Larimer County has been a Colorado state-appointed “consolidated child care community”, with the task of creating a better system for child care at the local level. Wendy Watson, spokesperson for the Larimer Child Care Economic Impact study, explained that “it didn’t take us very long to get to the point where we realized the fiscal issues around child care are really one of the most significant barriers to our work…the conversation always ended up coming back to the issue of wages and finances and lack of resources to get things done.” The Early Childhood Council of Larimer County convened regular meetings with local funders over the course of a year, with the goal of developing solutions and strategic planning around this issue. In the end they realized the need to do what Wendy Watson called “social marketing” around child care and finance issues. In order to successfully carry out social marketing, the Council decided it would need better information about the financial contribution of child care to the local economy.
The two primary goals of the Council in conducting an economic impact study were to characterize the child care industry in Larimer County in comparison with other industries, and to estimate its economic impact. The Council realized that having data describing child care as a “business” contributing to the local economy would play an important role in engaging partners with resources, influence, and decision-making authority, in order to bring about systemic change.
The Study:
Sector Definition
The study differentiated between licensed care, which includes family homes, child care centers, preschools and after school care on school property, and unlicensed care, which includes paid care provided by relatives, friends, nannies, and neighbors. Measurement of direct effects in the economic model was restricted to parent fees or subsidies en lieu of parent fees for those parents who, BUT FOR child care, would reduce their labor force participation, or those who lived outside the county. These were considered ‘new dollars’ to the local economy. The study supplemented CCR&R and County Business Pattern data on employees and children served with a survey of 200 parents which helped them develop estimates of parental use of child care including paid care in the unregulated sector.
The Council was particularly interested in child care’s role in enabling parents to work, and thus was careful to focus on fee-based child care. This included care paid by a third party such as child care assistance program or Head Start, but did not include care that might be provided by a neighbor, friend or relative at no cost to parents or a third party subsidy.
Data Analysis
| Measurement* | Larimer Co. |
| Number of Establishments | 435 |
| Child Care Labor Force | 817 |
| Children Served | 6,924 |
| Gross Receipts | $30 million |
| Number of Parents with Children in Paid Care | X |
| Multiplier Effects on Local Economy | X |
| Governmental Transfers / Subsidies | |
| 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, regulation-exempt home-based care (informal care). In its definition of gross receipts, this study only included parent fees, vouchers in lieu of parent fees and provider subsidies for that portion of spaces which serve children from working parents who would alter their labor force participation BUT FOR the availability of paid child care. It also includes parent fees of those who live outside he county but have their children in paid child care within the county.
This study gave special attention to the new dollars injected into the local economy through the child care industry, as the Council felt that this would provide a more legitimate assessment of child care’s contribution. They defined “new dollars” as child care fees paid by working parents who would exit the labor force, or reduce their hours of work, BUT FOR the availability of paid child care, as well as the after-tax earnings net of child care expenditures of the BUT FOR parents. “New dollars” also included child care fees from parents who live outside the county but who use child care centers within the county.
Unique Findings
Based on the telephone survey of 200 parents, the Council found that:
- 60% of parents would alter their labor force participation but for paid child care. 41 percent of parents indicated that a working adult in their household would have to stop working if paid child care were no longer available. In one out of five households, a parent would have to reduce the number of hours worked each week.
- 93 percent of parents who choose their type of care because of educational opportunities, choose a child care center/preschool setting
- 29 percent of households use some form of paid care, while 71 percent of households rely on unpaid care by parents, relatives, or friends. Of those in paid care, 81 percent of parents placed their children with licensed providers.
- 50 percent of parents who use paid care choose a child care center or preschool, while 20 percent choose to leave their children with a family home provider.
- 6 percent of parents reported that they had to turn down a job or promotion because paid child care was inconsistent or unavailable, while 21 percent of reports reported missing 1-9 days of work each year due to child care problems. 9 percent of parents reported missing 10 or more days of work each year due to inconsistent or unavailable child care. If this percentage were extrapolated to all of Larimer county, it would represent 2,900 households.
Impacts:
Organizational Change and Outreach
In the process of creating and marketing the Economic Impact study the Council became aware of a need to link to individuals with fiscal and marketing expertise. The Council is currently exploring the possibilities of inter-organizational resource development and training.
Although the Council originally intended to work with a marketing/PR specialist for the roll-out of the Economic impact study, they found themselves hampered by funding and timing constraints. As a result, marketing efforts consisted of one-time events rather than an overall strategy. Marketing tools included PowerPoint presentations to various groups, including the employees of a company newly-located in Larimer; articles in local newspapers; and the creation of shorter, bulleted “Talking Points”, and “Quick Facts” sheets for quick reference.
Policy
The Council made general policy recommendations for employers and local government within the published report, but as of yet no further action has resulted from these recommendations. They include:
- Provide expertise to the Early Childhood Council of Larimer County as it works to design and finance an optimal system of early childhood care and education services in Larimer County .
- Explore policies that support child care similar to the ways in which local government policies support housing and transportation.
- Utilize child care tax incentives that can benefit employers and employees alike.
- Learn how to use existing corporate giving programs to achieve a positive impact for our youngest citizens.
- Endorse family friendly business practices.
The Economic Impact study also has helped the Larimer County Early Childhood Council consider the finance and economic impact aspects of their policy decisions in general.
Interview with:
Wendy Watson
Larimer County Early Childhood Council
Summer 2004