What company wouldn’t opt for an employee benefit that helps new families out and pays for itself in various ways? A recent report on companies that expanded child care assistance is an eye-opener for businesses that seek to attract and retain talented people — especially young mothers.
Five companies that implemented child care benefits in this decade — United Parcel Service (UPS), Etsy, Fast Retailing, Steamboat and Synchrony — enjoyed as high as a 400%-plus return on investment, according to a new report, “The employee benefit that pays for itself,” from Boston Consulting Group and non-profit Moms First. The profitability of their benefits came through savings — fewer caregivers calling out, coming in late or quitting their jobs — as well as avoiding the costs associated with hiring and training replacement workers.
Two of the companies invested in daycare centers, while the others increased dollar spend for child care:
- UPS set up an emergency daycare center for hourly workers at one of its California facilities. At the end of a 3-month trial, the retention rate for shift workers jumped from 69% to 96% and employee absences dropped by 16%. UPS is now expanding the daycare lifelines to three other sites. UPS’ program is giving parents a much-needed helping hand and promoting good will among employees. Some will be able to climb the ladder at UPS more easily as a result: “Because of this benefit, I not only got to keep my job, but now I get to be a supervisor and can start a career here,” said one UPS worker.
- The Steamboat ski resort in Colorado took advantage of state funding available for employer child care programs at the height of the coronavirus pandemic. Steamboat parents can drop off children at a nearby daycare center and check in on them during breaks. The company also offers six weeks of paid parental leave, an additional six weeks of leave through personal time and a dependent care flexible spending account to give working parents a boost.
- Fast Retailing offers a monthly $1,000 child care stipend that can be used for up to 3 years for children under 7 years old. Eight-six percent of workers say they’re more likely to stay at the company as a result. Etsy and Synchrony are also seeing positive results measured in less absenteeism through providing stipends for working parents.
Child Care Needs Growing As Pay Flatlines, Inflation Rises
Moms First is making the case for companies to quantify the economic payoff of child care and similar family benefits. Most companies that offer some financial help to new parents don’t track the costs and savings, the group says. Better data would entice more companies to expand their programs and possibly look into near- or on-site daycare options.
The U.S child care system leaves “more than 50 million parents to patch together child care, facing obstacles like cost, access, reliability, and quality,” argues Moms First. “Without support, some parents are held back — avoiding new challenges, promotions or travel — or leave the workforce altogether. As a result, they miss out on career growth opportunities, earnings and chances to advance.”
Pandemic funding for child care recently ran out. States are being forced to cut back on financial help for new parents after the $3,600 per child tax credit expired.
