| BUSINESSWEEK ONLINE : APRIL 26, 1999 ISSUE | ||||||||
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| NEWS: ANALYSIS & COMMENTARY
Who's Minding the Baby? The Company Staples Inc. (SPLS) has offered every inducement it can think of to find new employees and retain existing ones: flex time, job-sharing, telecommuting, even a concierge service at headquarters to pick up dry-cleaning. But, according to Nancy Lazgin, director of corporate benefits for the Framingham (Mass.) office-supply chain, it wasn't enough. So Staples will open a $1.4 million, 8,000 square-foot child-care center adjacent to the new corporate headquarters on June 28. ''This is one thing that will very definitely make a difference,'' Lazgin says. She better hope so. As employers scour the labor market for recruits, they are coming up with single parents and low-end workers who often have trouble making child-care arrangements. To lure these people to full-time positions, businesses must help answer the question: Who will mind the kids while I'm at work? ''Work-family issues are a reality,'' says James N. Sullivan, vice-chairman of Chevron Corp., which launched a child-care program 18 months ago. ''Any company that hasn't faced up to that is living in a different age.'' Sure, child care doesn't come cheap. An on-site day-care center, for instance, can cost up to $3 million to build. One annual slot at backup day care, which covers 300 visits, costs $27,500. But according to Faith Wohl, president of Child Care Action, ''it's the cheapest cost benefit in the benefit portfolio.'' It's also a lot less expensive than losing workers. Ask Federal Express Corp. It hires 40,000 operations employees and has about a 9% attrition rate, says recruitment manager David Huffer. To replace even one of these hourly workers costs about a half-year's pay. To hold onto workers and cut attrition costs, FedEx (FDX) is thinking about expanding day care. FedEx saw the results when it inherited a day-care center with the purchase of BankAmerica Corp.'s (BAC) office space in Dallas. FedEx decided to pick up the bank's contract with Bright Horizons Family Solutions, the largest provider of employer-sponsored child care in the U.S. ''It is really proving to be a great recruiting and retention tool,'' says Huffer, who estimates a 10% improvement in employee retention in Dallas. Bright Horizons is part of a fast-growing $300 million industry geared to helping companies tackle child-care issues. ChildrenFirst Inc., for example, provides backup day care for workers at corporations such as Viacom (VIA.B), Chevron (CHV), Lazard Freres, and American International Group (AIG). The company now cares for 20,000 children and revenues are growing by 50% annually, says Chief Executive Rosemary Jordano. One of the children is Toni Boll's 18-month-old son, Jonathon. Boll is a single mother who joined Ernst & Young's Chicago office as coordinator of expatriate income-tax returns in January. During the spring tax season, she must put in 10-hour days, but found it difficult to find child care for the extra hours. Says Boll: ''I couldn't have taken the job if the firm didn't have this backup child care.'' Still, most companies don't take on child care directly. In a soon-to-be-released work-and-family study of 1,020 large employers, management consultant Hewitt Associates found that only 11% offer on-site facilities and 15% provide emergency day care. ''It's too expensive, and the investment wouldn't benefit all employees,'' says Bonnie Fennig, human relations manager at E.H. Wachs Co., a small tool manufacturer in Wheeling, Ill. That attitude could change if the labor market continues to tighten. By Ann Therese Palmer in Chicago _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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