How Companies Can Benefit From On-Site Child Care

Posted by Kathi Guiney on November 21, 2012, Employee Wellness | No Comments

The election may be over, but the season of kissing babies has only just begun!  With Thanksgiving upon us and the winter holidays coming up fast, kissable babies everywhere are celebrating the season with their parents.   And those parents are gladly taking time away from their jobs to prolong the quality time with their little ones.  Of course, it’s not all fun and games.  Caring for a child is hard work—a full-time job in itself that offers no wages, no PTO, and no desk manual.  For parents who already work a regular full-time job, these constant demands can leave them craving stress leave.  That’s why employers of working parents should be sensitive to this challenging “second job” during this season of caring.  But employers also have the power to offer a life-saving option all year long: on-site, employer-sponsored child care.

It may be obvious how on-site child care could benefit working parents, but they’re not the only ones who win in this arrangement.  Aside from a “kiss the baby” image boost, how can companies benefit from offering child-care options?

  • Possible monetary savings.  Could it be possible to operate an on-site child-care center and save money?  The 2005 “Kids at Work” study by Connelly, DeGraff, and Willis says yes.  This in-depth analysis found that the firms offering employer-sponsored child care got back as savings between 50 and 200 percent of the costs to operate the child-care centers.  That’s right—in the hundreds of programs surveyed, many sites actually saved money thanks to reduced turnover and absenteeism, as well as wage savings.  How’s that for making good on the company’s bottom line?  And what’s better, studies have found that employees—even those without young children—were willing to subsidize on-site child care to the tune of $125 to $225 per year, because of how they believed it would benefit morale and productivity.
  • Improved morale and productivity.  Is it any wonder employees who have their kids close by would be happier and more productive?  At the beginning and end of a long day, parents do not have to spend more time in the car driving to an offsite child-care facility, so they can get some of their time and energy back.  Parents can also enjoy peace of mind and be better able to focus on work, knowing their children are an arm’s-length away in a safe environment.  They can even visit their kids on lunch or breaks—precious, priceless moments for working parents.
  • Decreased turnover and absenteeism.  Sure, working parents benefit from those precious, priceless moments with their children, but companies benefit too!  A report by the National Conference of State Legislatures found that child-care issues caused increases in absenteeism and tardiness in nine out of 10 companies surveyed, with 80 percent of companies citing that workdays were cut short because of child-care issues.  And let’s face it—sometimes new parents miss work simply because they miss being with their little ones.  “Kids at Work” found that a reliable on-site center works wonders for these types of turnover and absenteeism.
  • Supercharged recruitment.  The Millennial generation of talent is all about family and flexibility, and they’re willing to switch jobs until they find it.  According to a study by Simmons College, Graduate School of Management, 93 percent of parents cited on-site child care as an important factor in job change.  For 42 percent of parents surveyed, on-site child care was an important factor in their decision to onboard with their current employer.

While on-site child care is a significant investment in a company’s future, the program can be expensive to start up and may require a whole new set of insurance and liability considerations.  But providing on-site child care is not the only option employers have to help their rugrat-rearing employees.  Some companies offer a dependent care flexible spending account—a benefit that allows employees to set aside part of their pretax wages for child-care expenses.  Employees can then request reimbursement from this account.  How’s that for an alternative?

Employer-sponsored child care remains a polarizing issue that continues to leave many companies and employees at odds.  This issue’s importance will only continue to grow as Millennial workers demand more family-related perks in exchange for their loyalty.  At the end of the day, it’s important to carefully consider if “kissing the baby” is right for a company and its employees.  But consider this: any parent willing to brave a commute while listening to all five thousand verses of “The Wheels on the Bus” is surely an employee worth keeping!


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