Down, But Not Out

01/16/2009

The secret to a good life is not about having a positive attitude, it’s about taking positive action.
Paul S. Boynton author, Begin with Yes

With all the doom and gloom economic news, one would think that the entire world is falling apart. However, many of you helped us survey the current economics of the early childhood world, and your views were not as discouraging as expected. In the most recent Exchange Insta-Poll we asked you to rate on a scale of 1 to 10 the amount that enrollments and funding have declined in your communities.

In most regions of the United States you rated the early childhood economy as a 5 — which we defined in the survey as "Funding and enrollments have declined moderately (around 5%)." Now a 5% decline is never good, but it certainly is not "going out of business" bad. Respondents from the southwest rated their economy slightly better (a 4), and those in New England rated it slightly worse (a 6). Early childhood professionals in Canada told us that while things are tightening up, they are not doing nearly as bad — their average rating was 3, which we defined as "Funding and enrollments have declined slightly (less than 3%)."

These results, while encouraging in the sense that we are doing better than banks, hotels, and mega department stores, are still cause for anxiety. This is particularly the case when you consider that in many states and provinces public reimbursement rates and private fees have only increased marginally over the past four years, meaning that center budgets were already strained to the max.

In the face of economic stresses, one reaction is to slash costs and cut corners on quality and customer service in order to get by. This may have the effect of balancing the budget in the short term. However, it means that when the economy starts to turn around, your center will have alienated its customer base and irreparably tarnished its reputation. On the other hand, if one can manage to treat your customers with respect and courtesy and cut corners that do not impact basic quality of care, when the economy bounces back, you will be in a position to assume a preeminent position in the market either as the recipient of rising public funds or increased private fees.

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