Social/Economic Benefits of Investing in Early Childhood

Early Childhood Education and Care (ECEC) services play a crucial role in the development of young children, setting the foundation for their future academic and social success. Despite being a developed country, Australia lags behind other similar countries in investing in high-quality ECEC services. The current low levels of investment in this sector have resulted in the provision of sub-standard services by private for-profit providers, negatively impacting the early development of children and limiting their future potential. 

Insufficient Investment in Early Childhood Education and Care (ECEC) in Australia

As per the Organisation for Economic Cooperation and Development (OECD), Australia's commitment to pre-primary education falls notably below the average for comparable nations. In 2018, Australia allocated merely 0.3% of its Gross Domestic Product (GDP) to ECEC services, trailing the OECD average of 0.7%. This lack of investment has resulted in a scarcity of qualified educators and a deficiency in resources, contributing to subpar childcare provisions.

The deficiencies in Australia's ECEC services have remained a persistent concern for policymakers, educators, and parents alike. Despite the implementation of a universal access to ECEC policy a decade ago, aimed at enhancing service accessibility, it has fallen short in addressing the overarching issue of low quality. This underscores the imperative for increased investment in the training and upskilling of ECEC staff, alongside improvements in infrastructure and resource allocation.

Benefits of Investing in High-Quality ECEC Services

Research has shown that investing in high-quality ECEC services is a public service that proves to be financially self-sustaining in the long term. Premium ECEC services play a pivotal role in bolstering female Labor force participation, resulting in substantial economic, social, and fiscal advantages. The increased engagement of women in the workforce translates to elevated incomes, heightened spending, greater production, and increased tax revenue, ultimately fostering robust economic growth.

Enhanced ECEC services not only create an optimal learning environment for children, fostering the development of crucial social, emotional, and cognitive skills, but they also empower parents to focus more on their work, assured that their children are receiving top-notch care and education. Furthermore, quality ECEC services contribute to a deeper understanding of diversity and gender equality, instilling high self-esteem in attending children and paving the way for improved academic and employment outcomes later in life.

Investment in high-quality ECEC services brings about positive transformations in the overall childcare sector. This investment leads to the professionalization of the sector, resulting in elevated salaries and improved working conditions for childcare workers, ultimately enhancing retention rates. Additionally, the sector attracts a more diverse talent pool, drawn by improved salaries and working conditions. Furthermore, the provision of quality childcare services keeps parents actively engaged in the workforce, minimizing absenteeism and fostering a more productive and efficient workforce.

Examples from Other Countries

International examples from countries like Canada, Sweden, Norway, and Denmark underscore the global recognition of the benefits derived from investing in ECEC. These nations have witnessed substantial improvements in service quality and availability, with positive impacts on children, parents, and a noteworthy surge in female labor force participation and gender equality.

Australia's current low investment in ECEC services demands immediate attention as a national concern. Viewing high-quality ECEC services as a public service and integral to social and economic policy is crucial, transcending the notion of a private venture. Investing in ECEC services proves to be a mutually beneficial strategy for society, nurturing the development of future generations and enabling parents' full participation in the workforce—contributing to robust economic growth and advancing gender equality. The evidence unequivocally supports the notion that high-quality ECEC services yield long-term benefits, underscoring the urgent need for Australia to align with similar countries and substantially invest in ECEC services. This investment ensures equitable access to quality early education and care for all children, charting a course toward a more promising future for our society as a whole.

Steve Roy

Adviser & Business Analyst