Although Canada has traditionally ranked low among developed nations in spending on early childhood development, there are signs that business leaders are taking up the cause. Key to that business involvement has been the growing volume of facts and figures confirming the high rate of return from investment in children as an economic stimulus.

Ontario, saddled with a $24.7 billion provincial deficit and the loss of 206,000 jobs since October 2008, has recognized that early childhood education is one of the best stimulus investments it could make to ensure future prosperity. The provincial government has committed to phase in full-day learning for 4 and 5 year olds, beginning in 2010.

For many years, now retired RBC executive Charlie Coffey has delivered a strong message to the business community about the importance of investing in early childhood education in Canada.

In a late September speech in Amherst, NS, he again stressed the importance of investing in children to create a business environment that attracts and retains employees. "ECD is not regarded as a health issue but it is. It's not regarded as an economic issue but it is. And it's not regarded as an urgent issue but it is. It's time for the pendulum to change and it's time to invest in young children. The economic and social future of Canada rests in very small hands. That is why our children deserve the very best start in life."

Daniel Trefler, who holds the Canada research chair in competitiveness and prosperity at the Rotman School of Management in Toronto, commented recently that the business community will decide whether we have an early childhood policy in Canada. "No other group has the power."

An internationally trained economist, Trefler has taken an prominent role in attempting to convince corporate decision-makers that investing in children is both responsible and affordable. Toronto Star columnist Carol Goar says Trefler's approach employs economics, demographics, medical science and a blizzard of statistics and calculations along with the Crusader's zeal.

At a recent management conference at the Rotman school, he offered participants an investment with a spectacular yield and no risk and then provided an itemized tally of all the paybacks of early childhood education. These include an increase in the percentage of children who stay in school leading to higher employment and earnings. Other paybacks, he said, included a more skilled workforce, leading to higher productivity; an influx of young mothers into the labor force, leading to higher family incomes; a reduction in health care and social service costs; and a drop in domestic violence and crime. "For every dollar you spend, you get $10-$16 back," he said. "Where in the market do you get an ROI like that?"

Trefler also pointed out the cost of doing nothing. Employers would need to look harder and farther for qualified workers. Canada will have trouble competing with countries with younger populations.

Early child development is recognized by researchers as a critical issue for business leaders because the years before age 6 set in motion factors that will be determining the quality of the future labor force. In fact, according to a recent study in British Columbia, governments and business have 10 times as much reason to worry about the early childhood vulnerability debt as there is reason to worry about the fiscal debt.

Dr. Clyde Hertzman, co-author of A Comprehensive Policy Framework for Early Human Capital Investment in BC, says the stock of human capital in BC is key to its long-term economic success. Dr. Hertzman is director of the Human Early Learning Partnership (HELP), the College for Interdisciplinary Studies at the University of British Columbia. The policy framework, released in August 2009, was prepared for Business Council of the BC Opportunity 2020 Project.

In BC only 71% of children arrive at kindergarten meeting all the developmental benchmarks they need to thrive both now and in the future and 29% of BC children are developmentally vulnerable. While the poor are more statistically likely to be more vulnerable the majority of vulnerable children in BC reside in the more populous middle class. Early vulnerability is a clearly a middle-class problem.

Dr. Hertzman says a rate of child vulnerability above 10% is biologically unnecessary and at almost three times what it could be, the current vulnerability rate signals that BC now tolerates an unnecessary brain drain that will dramatically deplete its future stock of human capital. Economic analyses revealed this depletion will cause BC to forgo 20% and GDP growth over the next 60 years. The economic value of this loss is equivalent to investing $401 billion today at a rate of 3.5% interest, even after paying for the social investment required to reduce vulnerability.

Recognizing the importance of early human capital investments, the B.C. strategic plan commits to lowering the provincial rate of early vulnerability to 15% by fiscal year 2015/2016. At present, 93% of BC neighborhoods have vulnerability rates that exceed even the intermediate target of 15%. This 15 x 15 goal is ambitious but is considered a reasonable signpost along the way to the ultimate goal of reducing early childhood vulnerability to 10% by 2020.

In the United States, there is strong evidence that business leaders are looking to early childhood education to move America toward economic recovery.

There is a growing consensus among economists, such as Nobel laureate James Heckman, that the most cost effective human capital interventions occur among young children. Heckman noted in 2008 that a major refocus of policy is required to capitalize on knowledge about the life cycle of skill and health formation and the importance of the early years in producing skills for the workforce.

In late September, more than 100 business and government leaders met in Telleride, CO for an economic summit on early childhood investment. The summit highlighted the critical role that proven programs supporting young children play in strengthening the US economy."Now more than ever, leaders recognize that investing in children is investing in our future economic success" said Ecolab president Doug Baker. "The summit gives us the tools we need to turn a business case for early learning into an actionable plan." Rob Dugger, managing partner of the Hanover Investment Group, commented that effective human capital development is at the core of the US economy and is firmly rooted in early childhood.

Universally accessible early childhood education also scores high marks under the scrutiny of a cost-benefit analysis. A 2006 study conducted by Texas A&M University determined that for every $1 invested in high quality early education, at least $3.50 is returned to Texas communities. It examined both the short and long-term benefits of investing in pre-kindergarten programs, including increased cognitive and social development, fewer special education referrals, reduced involvement in criminal activities, increased income in lifetime earnings for mothers and improved work performance.

Although early childhood education hasn't traditionally been portrayed as an economic development initiative, it appears likely that underfunded programs will increasingly look to the business community for validation and support.