High-quality early childhood programs will increase the adult skills of former child participants. But this only pays off for local economic development if a significant number of former child participants live in the local economy of their childhood when they become adults. They need not stay in the same local economy their entire life – many people leave their home metropolitan area or state for college, and others eventually leave for a retirement area. But for their original home economy to gain from their skills, they need to live in that home area during their working careers.
Based on research done for my book, Investing in Kids, many former participants in early childhood programs will live in that same local economy for most of their working careers. Around 70% will live in their childhood state. Around 55% will live in their childhood metro area. For the smallest metro areas, with less than one-third million in population, the percentage living in their childhood area for most of their working careers will dip by about ten percentage points, compared to the average metro area. For the slowest-growing quintile of metro areas, the percentage living in their childhood area for most of their working careers will dip by about five percentage points, compared to the average metro area. (In addition to the results provided in my book, more detailed results and methodology are provided in my Upjohn Institute working paper on this topic.)
The implication is that enough participants in early childhood programs stick around that the size and quality of these programs will affect the quality of the local labor force. If the effectiveness of early childhood programs in leading to adult skills is high enough, investing in these programs can potentially pay off for a state or local government.
Why do so many people stay in or return to the local economy of their childhood as adults? This probably reflects ties to the familiar places and people of their home. Smaller metro areas offer less diverse opportunities, but may foster stronger ties. Slower-growing metro areas will have fewer job opportunities, but less labor market competition from in-migrants.
As Adam Smith stated in the Wealth of Nations over 200 years ago, “a man is of all sorts of luggage the most difficult to be transported.”