Is Universal Pre-Kindergarten Worth the Investment?
The use of evidence-based decision-making remains rare in education policy. In Canada, several jurisdictions offer universal pre-kindergarten (UPK) programs. Prince Edward Island’s Universal Pre-Kindergarten Program (UPK) provides all four-year-olds with 15 hours of free play-based learning per week. Ontario offers Full-Day Kindergarten (FDK) for four- and five-year-olds, delivering five hours of educational programming per day throughout the school year. Nova Scotia’s Pre-Primary Program offers free, universal pre-primary education to children the year before they start school. While UPK is costly, governments continue to invest in it. But who benefits the most from UPK?
A recent working paper from the National Bureau of Economic Research (NBER), Parents’ Earnings and the Returns to Universal Pre-Kindergarten, examines UPK’s economic impacts on parents’ labor market outcomes. Conducted in New Haven, Connecticut, the study by Humphries, Neilson, Ye, and Zimmerman utilized a randomized lottery design to assess UPK’s effects on parental earnings, childcare costs, and children’s academic performance. The findings indicate that UPK enrollment led to a 21.7% increase ($5,461 USD annually) in parental earnings during the pre-kindergarten years. These earnings gains persisted for at least six years, averaging 20.9% ($6,469 USD per year), with the greatest benefits seen among middle-income families. Parents with children in UPK experienced fewer career disruptions, greater job stability, and fewer low-earning quarters.
In terms of childcare, the study found that UPK students received an additional 11.3 hours of childcare per week. However, it did not find statistically significant improvements in student test scores from kindergarten through eighth grade. While the study does not rule out the possibility of long-term benefits emerging in high school or adulthood, no substantial academic gains were observed in the medium term.
There are cost-benefit analyses of early-intervention literacy and numeracy programs. These studies tend to consider the longer term economic and social effects on the child and society. These studies (to my knowledge anyway) miss the economic benefits that accrue to the parents, as this study demonstrates. Including such benefits would strengthen the argument for such early intervention programs.
A key takeaway from the study is its cost-benefit analysis. Tax revenues from increased parental earnings offset 90% of UPK costs. For every dollar spent on UPK, $10.00 USD in benefits is generated. While UPK’s direct benefits for children are lower than other early childhood interventions, its economic returns for parents are substantial. The study also suggests that means-testing UPK could reduce its efficiency, as middle-income families experience the greatest earnings gains.
While the study provides evidence on UPK’s economic benefits, several limitations exist. First, it only tracks students’ academic performance through eighth grade, missing potential long-term impacts. While the study examines labor market effects, it does not assess broader social benefits such as crime reduction, improved health, or civic engagement. Another limitation is that the study is based on New Haven’s UPK program, which provides 10 hours of daily childcare, significantly longer than many U.S. state-funded pre-K programs that range from 2 to 6.5 hours daily. This raises concerns about whether the findings are generalizable to other regions. Furthermore, the survey data used to assess labor supply effects had a relatively low response rate (5.3%), with respondents skewing toward wealthier, suburban families who were more likely to enroll in UPK. While the study attributes the sustained 20.9% earnings increase to UPK, this figure exceeds standard estimates of returns to work experience (typically 2.5%–10% per year), suggesting additional economic influences may be at play.
The study shifts the focus of traditional cost-benefit analyses of UPK from children’s educational gains to parents’ economic outcomes. With a high cost-benefit ratio (about 10:1), UPK can be viewed as both an educational and labor market policy. Further research is needed to assess whether these findings apply in jurisdictions with shorter school-day programs, such as those in PEI, ON, and NS, as well as the long-term economic and social effects on children and broader family well-being beyond employment gains.
Research, including the NBER study, indicates that UPK benefits both children and their parents, with particularly strong economic advantages for middle-income families through increased workforce participation and earnings. However, these benefits depend on the structure and duration of the program. New Haven’s 10-hour daily model provides substantial labor market support, whereas the more limited program duration in Prince Edward Island, Ontario, and Nova Scotia may offer fewer economic advantages. The study’s findings suggest a strong case for expanding program support in PEI and Ontario to better align with the needs of working parents. This raises a related policy question: is there a threshold number of hours or days of UPK that would generate the same positive labor market effects without requiring a full 10-hour day? Understanding whether a slightly expanded version of the shorter programs could deliver similar economic benefits would be a valuable area for further research.
If UPK is evaluated solely on educational outcomes, its cost-effectiveness may seem less compelling. However, when the broader economic benefits are considered, particularly for middle-income families, the case for investment strengthens. In an education policy landscape that is often shaped by ideology rather than evidence, discussions on UPK should be grounded in rigorous research that examines not just whether it works, but how much support is necessary to maximize both educational and economic returns.