Economic Contribution of the Early Childhood Industry


Our Nation’s Economic Infrastructure

The childcare industry is a powerful economic driver, contributing more to GDP than many other higher profile industries.

Direct Economic Effects:

About 11.6 million slots in licensed settings (2010 data).

Over 1M employed full-time in licensed settings; 1.2M part-time; and 1.1M Family-Friend-Neighbor (FFN) or other unlicensed workers (2001 data).

Families spent $38 billion on licensed childcare for children under 5.

The public sector (federal, state, local governments) spent $15B in 2001.

More than $9B was generated in taxes in 2001.

Contributions to GDP Through Leveraging and Enabling Effects:

Licensed childcare enabled working parents to earn over $102.5B a year.

Their wages generated $579B in direct and indirect labor income, $69B+ in taxes, and supported about 15.2M jobs (2001 data)..

This represented $904B of GDP, 10% of our $10 trillion economy.

Our State’s Economic Infrastructure

Direct Economic Effects:

108,900 slots in licensed settings.

12, 906 direct-care workers employed in licensed centers, 9,730 self-employed in family child-care homes. No estimates for FFN or other types of care but 251,000 children lived in homes in which all parents work.

Families spent about $343.7M on licensed childcare (2009 report).

The public sector spent $223.1M (2009 report).

92% of the money spent stays in Colorado.

Contributions to GSP Through Leveraging and Enabling Effects:

Government-subsidized childcare enabled poor parents to earn over $111M a year. If other income brackets were considered, this amount would be much greater.

These wages generated $570M in direct and $492M in indirect labor income, and $12.3M in taxes (2001 data).

This represents $1.074B of GSP.

These numbers would be much higher if FFN and other unlicensed care were included and if the data were more recent.


Click here to view links to data sources and reports for the national and state information.

Our Local Economic Infrastructure

MECC hasn’t done an economic impact study of the childcare industry in our service area, so our information is incomplete. However, assuming that the economic models used to generate the above information apply locally, it’s safe to say that the “childcare” industry is very important to our local economy.

603 children in Montezuma County in licensed settings..

625 children in some other form of care, some of which we  can assume is paid.

Families spend from  $75,375 – $105,525 per week! on licensed childcare.

These revenues pay providers, directors, and support staff; purchase supplies and services (real estate, insurance, accounting, etc.) from local vendors; and enable working parents and providers to themselves spend their income supporting our local economy. MECC itself brings in over $200,000 annually from federal and state sources as well as grants from foundations, thus supporting local businesses by purchasing goods and services, as well as employing local professionals who themselves pay taxes and spend money supporting local businesses.