School closure is an important component of U.S. pandemic flu mitigation strategy. The benefit is a reduction in epidemic severity through reduction in school-age contacts. However, school closure involves two types of cost. First is the direct economic impact of the worker absenteeism generated by school closures. Second, many of the relevant absentees will be health care workers themselves, which will adversely affect the delivery of vaccine and other emergency services. Neither of these costs has been estimated in detail for the United States. We offer detailed estimates, and improve on the methodologies thus far employed in the non-U.S. literature. We give estimates of both the direct economic and health care impacts for school closure durations of 2, 4, 8, and 12 weeks under a range of assumptions. We find that closing all schools in the U.S. for four weeks could cost between $10 and $47 billion dollars (0.1-0.3% of GDP) and lead to a reduction of 6% to 19% in key health care personnel. These should be considered conservative (i.e., low) economic estimates in that earnings rather than total compensation are used to calculate costs. We also provide per student costs, so regionally heterogeneous policies can be evaluated. These estimates permit the epidemiological benefits of school closure to be compared to the costs at multiple scales and over many durations.
School closures are an important and controversial part of the U.S. federal government’s Community Strategy for Pandemic Influenza Mitigation in the United States. Closing schools would reduce social contacts and suppress transmission. A recent literature review concludes that the direct epidemiological benefits of such a strategy are uncertain and depend on the specifics of implementation, but could include a modest (~15%) reduction in total cases and a large (~40%) reduction in peak attack rates. Controlling the peak attack rate will be crucial to prevent the U.S. healthcare system’s surge capacity from being overwhelmed. In its model scenario, the President’s Council of Advisors on Science and Technology (PCAST) finds that flu cases may demand 50 to 100 percent of the total intensive care unit (ICU) capacity in the United States. This is a major threat to a system that operates at 80 percent of capacity during normal times.
Closing schools is controversial because the epidemiological benefits come with associated costs. With their children out of school, many parents will stay home from work. This absenteeism will lead to significant economic costs. Compounding the problem, some absentees will be health care workers. The most pronounced benefit of school closure is to alleviate pressure on the health care system. But if health care absenteeism is high, the system’s capacity could be reduced when the virus is most prevalent and the demand for health care services is highest.
PCAST emphasizes the lack of research on the magnitude of these formidable costs: “Although evidence-based estimates of such costs are difficult to make and inherently imprecise, they can help to advance the rationality of the debates…” To that Center on Social and Economic Dynamics Working Paper No.55 end, this paper includes the first detailed estimate of two of these costs in the United States. We estimate the economic cost of school closure and its impact on the health care system. In addition to providing the first detailed estimate using U.S. data, we enrich the existing international literature in three ways. First, we use a more comprehensive method to identify adults who stay home to provide care. Second, when calculating the value of work missed by caretakers, our data allows us to use the caretakers’ actual wages for all caretakers who are not self-employed. Third, recent survey data enable a precise estimate of the proportion of the workforce that is able to work from home and the makeup of this segment of the workforce. We find that closing all schools in the U.S. for four weeks could cost between $10 and $47 billion dollars (0.1-0.3% of GDP) and lead to a reduction of 6% to 19% in key health care personnel.