EDUCATION
Early Childhood Learning , Preparing our Next Generation
The business of daycare and early childhood education reimagined for the post-pandemic era .
By Tom Worley Chief Operating Officer , Clear Tunnels Publishing Solutions
When the state of New Jersey mandated the temporary shut down of child-care and early childhood learning facilities on April 1 , 2020 , it allowed 500 facilities to remain open to serve the families of essential workers . Three of the 40 Lightbridge Academy providers in New Jersey were included in this exception . According to Guy Falzarano , CEO of Lightbridge Academy , those facilities were run at a significant loss to their franchisees . Aside from the primary business of franchising early childhood education facilities , Lightbridge Academy owns and operates 14 corporate centers . Anticipating the mandatory shut down , he decided to close its corporate facilities by March 19 .
“ The pandemic and corresponding economic shutdown was not kind to the early childhood learning industry ,” asserts Falzarano , who also serves as president of Early Childhood Education Advocates ( ECEA ). ECEA is an organization engaged in lobbying to aid and promote legislation that affects New Jersey ’ s childcare industry . The association estimates that nearly 1,300 of their member providers have had to close their doors permanently during the past 14 months .
Early childhood education is key to competing in a global economy . 8 COMMERCE www . commercemagnj . com
The shuttered businesses are mostly smaller operations that handled between 30-60 children . They weren ’ t prepared for the downturn and they simply ran out of money . Larger , more tightly managed organizations like Lightbridge and their larger competitors — Kindercare , Learning Care Group , Bright Horizons Family Solutions , Goddard Systems , Primrose Schools ,
“ We can spend money on education in the early years , or spend more for less results on education in the later years . Early childhood education is just a smart investment ”
and others — seem to have enough resources to weather the downturn . With razor-thin margins in this business , well-funded providers will survive , but not without pain .
When the state allowed providers to reopen with restrictions on June 15 , 2020 , resumption of business was slow , early months showed less than a 20 % occupancy rate . By the fall ,
Photo : Getty Images / iStockphoto occupancy rose to around 40 %; today , occupancy is at about 65 % of capacity . Industry experts don ’ t anticipate that percentage rising significantly until some of the restrictions are lifted .
Meghan Tavormina , president , New Jersey Association for the Education of Young Children ( NJAEYC ) has seen momentum building in the early childhood education space . The public and private sectors have come to the realization that early education is essential and critical to all aspects of life , whether you have a child or not . She concurs with Falzarano ’ s opinion that childcare is a foundational component of the economy . Without childcare people , primarily women , can ’ t go back to work . She also adds that the issue runs deeper . Tavormina opines , “ We can spend money on education in the early years , or spend more for less results on education in the later years . Early childhood education is just a smart investment .”
NJAEYC is a nonprofit 503c organization focused on the full spectrum of early childhood education facilities and the professionals that work in the field . It is a professional organization with almost 2,000 members statewide , representing teachers , directors , researchers , professors , volunteers , and others concerned with the well being of children from birth through the age of eight . Because the organization ’ s membership is based on annual renewal , it is unclear at this point whether the pandemic will affect membership , but one thing is certain ; the pandemic has had an enormous impact on the members ’ economic well being , work lives , classrooms , facilities , and school districts .
The measures imposed by the state — some necessary , others less so — hurt the profitability of providers in a number of ways . Pre-K is the most profitable age group for private providers and they rely on the revenue that this segment represents . Without pre-K revenue , it would be too expensive for parents of infants and toddlers to avail themselves of daycare . Necessary measures like implementing screening protocols and enforcing stringent sanitizing requirements are expenses categorized as the cost of doing business . Restricting parents and visitors from the building makes it very difficult to enroll new customers . Restricting pre-K group size to 15 ( The pre-pandemic max was 24 students .) drives up costs , as does disallowing staff to handle more than one group per day . This lack of flexibility to manage staff efficiently increases labor costs while the restriction of class size reduces revenue .
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