The Vermont Business Community Takes a Strong Stand in Favor of Early Childhood Investment

While the State of Vermont faces the same budget issues as the rest of the country, they are hearing strong advocacy for protecting early childhood investments from a surprising quarter: business leaders across the state. A recent report issued by the Vermont business community documents the financial returns realized by the state's investments in early childhood, and the positive implications of this investment for labor force development.  As Shelby County and Tennessee face similarly difficult budget decisions, it is helpful to see how another state values early childhood investments as part of a business development strategy.

Investing in high-quality early care and education, including pre-kindergarten programs, promotes optimal early childhood brain development and benefits the state and local economy –in both the short and long term. Expanding early education creates jobs right away, and an investment in education can increase a region’s income and employment over time. In fact, research shows that money invested in pre-kindergarten education produces many more jobs than spending the same amount on business tax incentives (Thompson 2010).

How Many Young Children?

In the fiscal year 2010, almost 4,900 children, about 37 % of the state’s three- and four-year-old population, were enrolled in publicly funded pre-K education. Because Vermont’s policy is to offer voluntary pre-kindergarten, there are of course parents who chose not to participate in early education by enrolling their children. In comparison, pre-k reaches roughly 22% of 4-year-olds in Tennessee.

At What Cost?

Based on figures currently available from the Vermont Department of Education and the National Institute for Early Education Research (NIEER), Vermont spent about $4,000 per student for pre-K education in the fiscal year 2009. Tennessee spends slightly more per student (at $4,520 per pupil).

Vermont’s per-student cost is about average for the 38 other states that now provide publicly funded pre-K programs.However, Vermont’s programs are typically open 10 hours a week, fewer than in many other states, which typically are open for 15 hours a week. NIEER estimated the per-student cost of these longer pre-K programs to be about $4,400 a year. This would suggest that Vermont’s average cost is somewhat high, but the Institute also has found that per-student costs decline as enrollment increases and efficiency improves.  Based on available information, $4,000 per student is a reasonable assumption for projecting the future cost of expanding Vermont’s pre-kindergarten programs.

The Take Away

Vermont’s business community recognizes that spending on early childhood development is one of the smartest investments that a community can make, in both the short and long term. Policymakers in Memphis, Shelby County and across Tennessee can learn from Vermont's analysis of both the immediate and long-term financial and social returns that accrue to investments in high-quality early childhood development.

To Learn More...

Hoffman, Jack. (2010). Increasing Pre-K Enrollment: Small Investment, Big Benefits. Retrieved from

National Institute for Early Education Research. (2009). The State Preschool Yearbook 2009. Retrieved from

Thompson, Jeffrey. (2010). Prioritizing Approaches to Economic Development in New England: Skills, Infrastructure and Tax Incentives. Retrieved from _study/priorities_August9_PERI.pdf.

Vermont Department of Education (2010).  Report to the Legislature: Implementation of Prekindergarten Education in Accordance with Vermont’s Act 62.  Retrieved from