Engaging Business Leaders in Child Care Needs

In America, child care has traditionally been a private, family issue. Yet today, the costs have skyrocketed, especially in states like New Jersey, and even just finding available and quality care can be challenging. Parents themselves cover more than 60 percent of the cost of child care, while government contributes about 39 percent, mainly in subsidies to lower income families. And yet businesses, though they are the direct beneficiaries of child care programs, cover just one percent of the costs. This lack of investment has negative impacts on families’ well-being, but also depresses labor force participation and holds back economic growth.

Many parents face the difficult choice between spending an average of nearly 30 percent of their paycheck on child care or leaving the workforce altogether. For a family with both an infant and a preschooler, the average cost of child care exceeds the median rent in every state. The cost of child care is currently twice what the U.S. Department of Health and Human Services considers affordable. So many parents, after doing the math, decide that one parent should leave the workforce to cover child care duties.

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One-third of highly educated American women drop out of the workforce every year, and 74 percent say the lack of decent child care is the primary reason. And yet, the nation faces a projected skills gap of 6 million unfilled jobs by 2020. The skills gap feeding an unprecedented labor shortage will only worsen if companies don’t directly provide child care solutions, according to the U.S. Chamber of Commerce Foundation.

The majority of U.S. families still do have both parents in the workforce, however. Yet, even if child care coverage has been secured, there are often breakdowns in that care. 29 percent of employed parents experience child care issues, which are associated with absenteeism, lateness, and reduced concentration at work. 45 percent of working parents miss at least one day of work every six months because of a breakdown in child care and 65 percent of parents are late to work or leave work early because of child care issues. It is estimated that U.S. companies lose $3 billion annually as a consequence of child care-related absences, according to the Child Care Action Campaign.

So what can corporate America do to support working families, increase their own productivity, secure skilled workers, and lower costs associated with lack of adequate child care? They can change their operations to be more flexible with working parents, can offer direct support for child care, or both. Some suggestions:

• Keep employees’ time predictable. Ensure meetings aren’t set at the very start or end of the day. Avoid telling employees that they need to work late at the last minute. When parents aren’t worried about making it back for child care pickup time, they can focus on work.

• Offer flexible schedules and locations. Allow employees to set times that work for them and an option to work from home whenever possible. Invest in infrastructure to allow people to call into meetings and video conference with colleagues. Flexibility is highly valued by all workers, and creating these policies can lead to happier employees overall.

• Start programs to help subsidize the cost of child care. Help employees contribute to the cost of care, either through vouchers, reimbursements or flexible spending accounts.

• Create onsite child care. While it is not inexpensive, it is highly valued, and may make financial sense. Companies can also pool resources with other businesses nearby and create cooperative child care centers.

Corporations can also become leaders in the fight for quality, affordable and reliable child care by lending their voice and influence to change course. Join with community-based organizations and foster philanthropic partnerships to draw attention and investment in child care issues. It is indisputable that businesses who support the needs of their workers are able to better attract and retain talent, experience reduced absenteeism, and have a more productive workforce. These are solutions that are in the best interests of families, businesses, and society at large.