Pre-K Spending and Enrollment Reach All-Time High, But Quality Concerns Remain

While both enrollment and spending in early childhood education programs reached new levels in 2024, a few select states did the lion’s share of the work — with many states lagging behind.

And with early childhood program funding in flux, some leaders in the sector are concerned the lack of investment — both financial and otherwise — could create a doomed domino effect for some programming.

“For decades we’ve said this is a system that blends and braids funding to serve kids,” Steve Barnett, director at the National Institute for Early Education Research, said. “If you pull out one of the major funding sources, the fear is the whole system is destabilized.”

The National Institute for Early Education Research, also known as NIEER, released its annual State of Preschool Yearbook report that details enrollment and spending in state-funded preschool programs for 3- and 4-year-old children. The study surveyed preschool administrators across 50 states and the District of Columbia, along with U.S. territories.

Enrollment Up, Quality Down Across the Board

While enrollment in 2023-2024 bumped up 7 percent in state-funded programs from the previous year, California and Colorado were responsible for the majority of that increase, bringing in more than 30,000 additional children — or 60 percent of the enrollment bump — across the two states.

Colorado rolled out its free, universal pre-K program in the fall of 2023. California started with a phased approach in the 2021-2022 school year, shooting for this current school year for all 4-year-olds to have access to the state’s free transitional kindergarten program.

But there is not necessarily a correlation between the increased enrollment noted in the new NIEER report and new offerings for public-supported programs.

“The positive trend is enrollment is going up; almost every state had an increase,” Allison Friedman-Krauss, associate director for policy research at NIEER, said.

Nine states increased enrollment by more than 20 percent: Alaska, Delaware, Hawaii, Mississippi, Missouri, Nevada, New Mexico, North Dakota, and Ohio.

Yet some states that have offered universal preschool programs for over a decade, including Iowa, Georgia and Florida, have stagnant or dropping enrollment.

“We’re a little worried these states may be canaries in the coal mine,” Barnett said. “Something is going wrong and there is a concern that it’s a cousin of the attendance problem” that has kept students out of K-12 classrooms.

There are also concerns about enrollment still dipping below pre-pandemic levels. The national percentage of 4-year-olds enrolled in pre-K increased from 34 percent to 37 percent, while the percentage of 3-year-olds enrolled increased from 6 percent to 8 percent. However, almost half of states (22 states) with state-funded preschool programs enrolled fewer children in the fall of 2023 than fall 2019, with 14 states serving a lower percentage of 3- and 4-year-olds in fall 2023 than fall 2019.

And quality in pre-K programs across the nation remains uneven. Only five states (Alabama, Hawaii, Michigan, Mississippi and Rhode Island) meet all 10 of NIEER’s recommended benchmarks for high-quality preschool programs, which include class size, teacher qualifications and program assessments. And 21 states only meet five or fewer of the benchmarks.

“When states put money into quality programs, they are investing in children’s futures and can expect to see returns on their investments. Low spending results in low quality,” the report states. “While that may seem to save money, it is wasteful and costly in the long run to fund programs that do not adequately support long-term gains and may even harm long-term outcomes for some children. Investing in quality raises the cost of pre-K but results in a larger long-term net return.”

Barnett and Friedman-Krauss said the number of states hitting the quality metrics — or not meeting them — has remained largely stagnant over the years. But Barnett added that assessing the quality of teachers, especially those receiving waivers to lower standards, is missing from the NIEER quality metrics since the report does not measure that.

“[The waivers are] a temporary patch when the real solution is they’re going to have to raise compensation,” he said. “The good news is more money per child will let you do that, but we have to see a continued investment in funding if we’re going to meet the challenges of the labor market for quality teachers.”

Funding Hits New Heights — But Comes With Own Concerns

According to the recent yearbook report, funding for state-funded preschool programs hit an all-time high in the past academic year, but similar to enrollment numbers, that funding boost came from a small group of states.

In the 2023-2024 year, states spent more than $13.6 billion on preschool, or nearly 17 percent more than the previous year after inflation adjustments. However, just four states (California, New Jersey, New York and Texas) made up more than half of that total spending.

Federal COVID-19 relief funding also dipped, down to $257 million. Friedman-Krauss expects that number to further drop as the funding becomes unavailable, but added it was a “pretty small portion” of the federal funds this year.

Six states increased state spending on preschool by more than $100 million over the prior year: California, Colorado, Maryland, New Jersey, New Mexico and Texas. And all-encompassing funding, including state, local, and federal dollars supporting state preschool, hit another all-time high at $15.3 billion.

Friedman-Krauss expects funding to increase in next year’s coming report, as the report will cover the 2024-2025 school year — which is nearly over and largely spared from the recent federal budget cut talks.

“[Next year’s funding] may not have been subjected to some of the forces that cause this uncertainty,” she said. “We see pretty much every year funding does increase. I would imagine we’d see higher funding in the following year.”

There is concern in the report and from the researchers on the proposed, potential cuts to the Head Start program, which serves more than half a million students. While cuts to Head Start specifically appear to be on the back burner, questions remain on the fate of other child care program funding.

“The federal context is the most cause for concern,” Friedman-Krauss said. “Not that federal funds are the majority of what’s going into the programs, but it does affect the whole landscape, so it could shift what we’re reporting.”