The document summarizes the economic challenges facing Illinois and argues that continued investment in early education is important for both the short-term and long-term economic well-being of the state. It notes that Illinois' unemployment rate has risen above 9% as the state faces its worst economic crisis since the Great Depression. Continued funding of the state's Preschool for All program would create over 9,000 jobs while helping families and laying the foundation for future economic growth by improving educational outcomes and workforce readiness. Cutting early education would disproportionately harm vulnerable families and have negative ripple effects throughout the economy. The document advocates for increased investment in high-quality early education as a proven strategy that generates jobs and social benefits.

1. 1
The Challenge
Like the rest of the American economy, the Illinois economy
has taken a nosedive. In 2008, 100,000 Illinois properties were
foreclosed on and last month the state’s unemployment rate
topped 9 percent and is likely to continue to increase.1
Many
business leaders who thought their companies were secure
and prosperous are now struggling to keep them afloat.
Continuing to invest wisely in early education will not only
help build a solid workforce for the future, it will help commu-
nities, businesses, and struggling young families right now.
Early care and education is an important
economic sector
The early care and education sector in Illinois is a large and vi-
tal sector of the economy. It could quickly absorb more invest-
ment and turn that into jobs that will impact the economy. The
sector employs more than 50,000 full-time equivalent employ-
ees in Illinois ­– an amount greater than the number of employ-
ees working in the hotel industry. And it generates more than
$2 billion in gross receipts – nearly as much as soybean farmers
in the state.2
The state’s Preschool for All early education program alone
serves more than 90,000 three- and four-year-olds and their
families, and employs more than 9,000 teachers.3
New jobs in the early care and education sector would mean
Summary
Illinois is facing the greatest economic shock since the Great Depression. Virtually every business leader is confronting challenges
on a scale they have never seen before. Even during these harrowing times, the business members of America’s Edge recognize
that Illinois’ future economic well-being is only as secure as the quality of the workforce supporting it. To provide the quality
workforce that Illinois needs now and when its economy recovers, state and local policy makers must continue their commit-
ment to invest wisely in educational programs that will fuel economic growth.
An excellent investment remains an excellent investment. The business leaders of America’s Edge call on local, state and federal
policymakers to increase investments in high-quality early education because it works.
Pre-k delivers:
More than 9,000 jobs through the state’s Preschool for All program.•
Reliable, quality programs that enable parents to work.•
A solid foundation on which to build Illinois’ future workforce.•
During a time when many tough calls need to be made, continuing to invest in early education is an easy call – one that business
leaders strongly support.
Early Education Works:
Illinois Business Leaders Say Rough Times Warrant
Continued Investment in Human Capital

2. 2
Illinois Business Leaders Say Tough Times Warrant Continued Investment in Human Capital
more spending by those teachers on
goods and services in the rest of the
economy. Economists have found that
for every two workers employed in the
early care and education sector, their
immediate spending on goods and
services can support an additional new
job elsewhere in the economy.4
The early care and education sector is
one of the most important sectors to
target for recovery spending because it
can quickly generate jobs in the short-
term. But investments in quality early
care and education will also help trans-
form the economy over the longer-term.
Cutting Pre-k would force
stark choices on parents
and employers
Illinois is a national leader in universal
prekindergarten, but it is only halfway
there. Although the state serves more
than 90,000 three and four-year old chil-
dren, there remain more than 115,000
children who come from families who
cannot afford quality preschool.
Pre-k is essential for parents: over
600,000 Illinois children have their
parents in the workforce.5
Over 90,000
families depend on state-funded pre-
school to provide their children with
high-quality early education. The turmoil
in the housing sector shows how prob-
lems in one sector can eventually ripple
through the whole economy, impacting
first construction workers, then small
business owners, and eventually nearly
everyone in some way. If early education
spending is cut, not only are those early
education workers out of work, a crisis
will immediately confront young families
as they struggle to remain on the job and
pay the high costs of quality early care
and education for their children.
The cost of quality early education can
cost nearly the same as sending a child
to college. The average cost of tuition
and fees for Illinois state colleges is
$10,000 ­a year – not that much more
than the $8,000 it costs for a year of full-
time center care for a four year old.6
Young families, almost by definition, are
the most economically vulnerable fami-
lies. If slots in state-funded quality early
education are eliminated, many families
could not support both the full cost of
private preschool and their mortgages.
Many parents need to work to pay their
mortgage, need a good environment for
their child while they work, but can’t
afford both a mortgage and the full cost
of preschool.
Parents may respond to this economic
challenge by putting their children in
lower-quality, less-reliable care, though
even poor-quality care is still expensive.
That will hurt their children by putting
them at risk of starting school already
behind. But it may also hurt employees
and their employers immediately be-
cause unreliable childcare causes parents
to miss work. That disrupts company
productivity and puts their jobs at risk.
If wise investments in early education
are a win-win-win situation for the chil-
dren, their parents, and local companies,
cutting slots is a losing proposition for all
concerned.
Illinois’ economy rests on a
crumbling foundation
Illinois is at the geographic crossroads of
America, and historically has had one of
the most resilient and diverse economies
in the Midwest. But, even before this
recession, it was clear that Illinois was
not adequately preparing its students to
compete in the global marketplace:
At-risk Kids: Not Just an Inner City Problem
The number of children who are under age five and living in poverty has been
essentially stable in Chicago itself from 2000 to 2007, but the number of poor
children under five has increased over 50 percent in the five Suburban Chicago
Counties during that period, and increased almost 40 percent in the Downstate
Counties. For example, the number of poor children under five has risen from
2,739 in DuPage County to 5,037, and the percentage of poor children in the
Metropolitan Chicago area who now live in Aurora has almost doubled.
Theresa Hawley, Ph.D., Early Childhood Policy Consultant,
based on data from the United States Census
In fact, no other school reform is as proven to improve
graduation rates as early education. Participants in the Chi-
cago Child-Parent Centers were 29 percent more likely to
have completed high school, and the children in the Perry
Preschool program were 44 percent more likely to graduate
from high school.

3. 3
Illinois Business Leaders Say Tough Times Warrant Continued Investment in Human Capital
Only 77 percent of Illinois students•
are graduating on time from high
school; and in Chicago, graduation
rates are down to 51 percent – half
of Chicago’s youth are not making it
through high school.7
The “Nation’s Report Card,” the•
National Assessment of Educational
Progress (NAEP), reports that in
2007, only 32 percent of fourth
graders in Illinois scored at least
proficient in reading (the level
demonstrating solid academic
performance); only 37 percent were
proficient in Mathematics. 8
As baby-boomers currenlty forgo retire-
ment, Illinois has a second chance at
better preparing its future workforce for
the demanding jobs of the future. Those
jobs will require higher academic, tech-
nical and team-working skills than the
jobs of the past. Business leaders have
long been aware of the looming crisis
with the state’s leaky pipeline of skilled
labor: too many of Illinois’ students are
ill-prepared to take their place in the 21st
Century workforce.
Building a solid founda-
tion for learning
Business leaders know that if Illinois is
going to succeed in the future, it must
invest in education now. Brains are built
over time, yet a substantial proportion of
the foundation upon which subsequent
knowledge is built is constructed during
the earliest years of life. That founda-
tion includes learning to play, focus, and
self manage; developing socially and
emotionally; and developing language
through exposure to words. Stimulation
is important. Children learn by experi-
encing and interacting, and these op-
portunities help their brains to develop
learning strategies. Together, these skills
make up the developmental foundation
that educators refer to as school-readi-
ness skills.
The research presented by James Heck-
man, the University of Chicago’s, Nobel-
prize-winning economist shows that
early education is a wise investment. The
lessons a child learns in early education,
particularly the lessons on how to get
along with others, to trust others, and to
follow directions, will last a lifetime. Pro-
fessor Heckman argues that Pre-k is such
an essential investment because these
basic social skills are pre-requisites for
acquiring further knowledge and skills in
school and in the workforce.
The science of what works
Carefully researched studies that have
followed children for years have shown
that children in high-quality early learn-
ing programs have higher rates of high
school graduation and college atten-
dance, lower dropout rates, and higher
incomes than the study participants who
did not receive the preschool programs.9
In fact, no other school reform is as prov-
en to improve graduation rates as early
education.10
For example, the Chicago Child-Parent
Center (CPC) preschool program showed
that gains were possible for a preschool
program serving over 100,000 inner-city
children. By age 20, participants in that
program were 29 percent more likely to
have completed high school. In another
analysis, for every 100 children in the
program there were 11 additional stu-
dents who finished high school. At age
24, those served by CPC were 11 per-
cent more likely to have either attended
college or to have been working steadily
than those left out of the preschool
program. 11
Persuasive support for Pre-k came from
an earlier study of children from Pre-k
through age 40 at the High/Scope Perry
Preschool Project in Ypsilanti, Michi-
gan. From 1962-67, preschool teachers
worked intensively with low-income
African American children aged three to
four. The children attended preschool
during the week and teachers came to
their homes once a week to coach their
parents. When the children were age 40,
researchers compared their life stories
with those who did not participate in the
early education program; the payoff was
impressive. Almost half of the preschool
children were performing at grade level
“In my mind, preschool is workforce development, and school readiness equates
to workforce readiness. The skills that children develop in preschool, the social,
the emotional and the academic skills, are the same skills that are in demand
by employers today, and despite the recession, they will remain in demand
tomorrow. We need workers who have the critical thinking skills to make sound
judgments, and the math and analytical skills to ensure that a gear is manufactured
with such precision that it cannot be off by the width of a single human hair. There
is no room for error. But if the error is made, the worker must have the character
to address the mistake with a supervisor, before passing something off as less than
perfect.”
Mary Ann Cervinka, Human Resource Manager for Arrow Gear,
testifying before the Illinois House Elementary and Secondary Education
Appropriation Committee.

4. 4
Illinois Business Leaders Say Tough Times Warrant Continued Investment in Human Capital
by the age of 14, compared with just 15 percent of the chil-
dren in the control group; 44 percent more of the children in
the Perry program graduated from high school; and 60 percent
of participants were earning upward of $20,000 a year in their
40’s, versus 40 percent of those in the control group.12
An excellent investment
Analysts have totaled up the various savings from early edu-
cation. Children who repeatedly fail in school and beyond
do not just disappear; their troubles can be very costly for
society in terms of crime, welfare, and other social problems.
Businesses either confront these expenses directly through
increased crime or poor employee performance, or indirectly
through increased taxes.
The researchers concluded that the benefits to society of help-
ing at-risk kids get off to the right start in life far outweigh the
costs:
In a recent report, economist Robert G. Lynch estimates that
if voluntary universal early education were brought to scale
in Illinois, by the time the children in those programs are at
their peak earning years in 2050, they could earn as much as
an additional $18 billion through their own productivity gains.
Illinois businesses and society in general will have gained as
much as $9 billion in increased profits and other benefits from
increased productivity. In addition, Illinois taxpayers could pay
$7 billion less in government expenses, and potential victims
of crime will avoid an addition $6 billion from reduced crime
costs.15
Businesses will capture an important share of those
savings because of reduced crime costs, lower taxes, and
increased profits.
The Bottom Line
Today’s businesses are developing more complex and innova-
tive products or services to compete in the global marketplace.
Those products and services require a better-trained and edu-
cated workforce. Yet the Illinois education system, like those
in other states, was created for an agricultural society that no
longer exists; even the students who do graduate are too often
ill prepared for today’s workplace.
It is clear that investments in quality early care and education
can build the foundation for our workforce of tomorrow. Pre-k
is not the only answer to the question “How can we reform
our schools?” But it is an essential and proven answer for how
to give our kids the foundation they’ll need to succeed in
school and in life. Business leaders support continued invest-
ments in early education because those investments will help
generate jobs, incomes and spending today, while building a
solid foundation for growth tomorrow.
Pre-K works. The business leaders of America’s Edge are con-
vinced that, even in these tough times, it is a wise investment
for Illinois and the nation.
Net benefits per child for investments in early
childhood education:
High/Scope Perry Preschool Program: •
$243,72213
Chicago Child-Parent Centers •
$70,97714
Acknowledgements
Support for America’s Edge is provided by The Buffett Early Childhood Fund, The Annie E. Casey Foundation, and The Horace
Hagedorn Foundation.
The High Cost of Dropping Out Unemployment
(March 2009)a
Average
Annual Salaryb
high school dropoutsc
13% $19,000
high school graduates 9% $26,000
college graduates 4% $42,000
a Bureau of Labor Statistics, b Commerce Department, c 25 or older
“A high school dropout earns about
$260,000 less on average during a lifetime
than a high school graduate.”
Bob Wise, President of the Alliance for
Excellent Education

5. 5
Illinois Business Leaders Say Tough Times Warrant Continued Investment in Human Capital
Endnotes
1 RealtyTrac. (January 15, 2009). Foreclosure activity increases 81
percent in 2008. Retrieved on April 29, 2009 from http://media.modbee.
com/smedia/2009/01/15/14/2008_Foreclosure_Market_Report_from_
RealtyTrac.source.prod_affiliate.11.pdf; Associated Press. (March 31, 2009).
Unemployment up in all Illinois metro areas. The Chicago Tribune. Retrieved
on April 29, 2009 from http://www.chicagotribune.com/business/chi-biz-
illinois-unemployment-march31,0,4646624.story;
Kruger, D. (March 30, 2009). Bernanke Treasury Plan Drives Pimco to
Mortgage Bonds. Bloomberg L.P. Retrieved on April 29, 2009 from http://
www.bloomberg.com/apps/news?pid=20601109&sid=aKIjVvcbW7Mw&ref
er=home
2 Alexander, D., Cahn, S., Slaughter, S., & Traill, S. (2005). The
economic impact of the early care and eduation industry in Illinois. Retrieved
on April 29, 2009 from http://www.chicagometropolis2020.org/documents/
FullEISStudy.pdf
3 Barnett, W.S., Epstein, D.J., Friedman, A.H., Boyd, J.S., &
Hustedt, J.T. (2008). The state of preschool 2008: State preschool yearbook,
New Brunwick, NJ: Rutgers University, National Institute of Early Education
Research. The estimate of the number of teachers is a rough estimate
generated by dividing the number of students served by the ratio of teachers to
students.
4 This is a Type II Employment Multiplier of 1.50, based on an
average from models of 50 states and the District of Columbia. Liu, Z., Ribeiro,
R., & Warner, M. (2008). Child care multipliers: Analysis from fifty states.
Ithaca, NY: Cornell University, Linking Economic Development and Child Care
Research Project.
5 National Association of Child Care Resource and Referral Agencies.
(2009). 2009 child care in the state of Illinois. Arlington, VA: National
Association of Child Care Resource and Referral Agencies. Retrieved on April
29, 2009 from http://www.naccrra.org/randd/data/docs/IL.pdf
6 National Association of Child Care Resource and Referral Agencies.
(2009). 2009 child care in the state of Illinois. Arlington, VA: National
Association of Child Care Resource and Referral Agencies. Retrieved on April
29, 2009 from http://www.naccrra.org/randd/data/docs/IL.pdf
7 To easily find the graduation rates for any individual school district,
city, or state, see: Education Week. (2008). Diploma Count 2008: School to
college. Bethesda, MD: Editorial Projects in Education. Retrieved on April 29,
2009 from http://www.edweek.org/ew/toc/2008/06/05/index.html
8 National Center on Education Statistics. (2007).The nation’s report
card. Washington, D.C.: U.S. Department of Education. Retrieved on April 29,
2009 from http://nces.ed.gov/NATIONSREPORTCARD/
9 Reynolds, A.J. Temple., Ou,S.,Robertson, D.L. Mersky, J.P.
Topitzes, J.W., et al. (2007). Effects of a school-based, early childhood
intervention on adult health and well-being. Archives of Pediatrics and
Adolescent Medicine, 161(8), 730-739; Schweinhart, L.J., Montie, J., Xiang,
Z., Barnett, W.S., Belfield, C.R., & Nores, M. (2005). Lifetime effects: The
High Scope Perry Preschool study through age 40. Ypsilanti, MI: High/Scope
Press.
10 Despite all the efforts to increase graduation rates underway, in
a meta-analysis of research on those programs, only five programs had the
quality of research design and then the subsequent results to be sure they
delivered increases in graduation rates; and two of those five programs that
worked were early education programs. (The others were a comprehensive
high school reform effort, raising teacher salaries by 10 percent, and greatly
reducing class sizes.) Levin, H., Befield, C., Muenning, P., & Rouse, C. (2007).
The costs and benefits of an excellent education for all America’s children.
New York: Columbia University, Teachers College.
11 Reynolds, A.J., Temple, J.A., Robertson, D.L., & Mann, E.A.
(2001). Long-term effects of an early childhood intervention on educational
achievement and juvenile arrest. Journal of the American Medical Association,
285(12), 2339-2380; Reynolds, A.J. (2007, March 31). Paths of influence from
preschool intervention to adult well-being; Age 24 findings from the Chicago
Longitudinal Study. In A.J. Reynolds (Chair), Paths of effects of the Child-
Parent Center preschool intervention on early adult well-being. Symposium
conducted at the biennial meeting of the Society for Research in child
Development, Boston, Massachusetts.
12 Farrell,C. (October 23, 2006). Going beyond Head Start.
Business Week. Retrieved on April 29, 2009 from http://www.businessweek.
com/magazine/content/06_43/b4006099.htm; Schweinhart, L.J.,Montie,
J.,Xiang,Z.,Barnett,W.S., Belfield, C.r., & Nores, M. (2005). Lifetime effects:
the High Scope/Perry Preschool Study through age 40. Ypsilanti, MI: High/
Scope Press.
13 Schweinhart, L.J.,Montie, J.,Xiang,Z.,Barnett,W.S., Belfield, C.r.,
& Nores, M. (2005). Lifetime effects: the High Scope/Perry Preschool Study
through age 40. Ypsilanti, MI: High/Scope Press.
14 Reynolds, A.J., & Temple, J.A., (2006). Prevention and cost-
effectiveness in early intervention: A 20-year follow-up of a Child-Parent
Center Cohort. Humphrey Institute of Public Affairs, University of Minnesota,
Minneapolis.
15 Lynch, R.G. (2007). Enriching Children, Enriching the Nation:
Public investment in high-quality prekindergarten. Washington, D.C.:
Economic Policy Institute.

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Illinois Business Leaders Say Tough Times Warrant Continued Investment in Human Capital
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