It’s obvious what working parents gain from on-site day-care programs: reliable, safe, and convenient care for their children. But what do the employers get out of it?
Let’s start with happier and more productive employees.
In a report by the National Conference of State Legislatures, employers cite child-care issues as causing more problems than any other family-related issue in the workplace, with increases in absenteeism and tardiness reported in nine out of 10 companies. And 80% of the companies surveyed said that work days were cut short because of child-care problems.
Child care benefits the employers who sponsor it by improving employee morale, reducing turnover and absenteeism, and increasing productivity.
And pampering bottoms might just help the bottom line. A cost-benefit study conducted by Cynthia Ransom and Sandra Burud at the Union Bank in Pasadena, Calif., showed the institution’s on-site day-care program saved it $138,000 to $232,000 in annual operations costs, due to the reduction in both turnover and absenteeism.
Child-care services enable employers to gain wage savings, too. For the book Kids at Work: The Value of Employer-Sponsored On-Site Child Care Centers, authors Rachel Connelly, Deborah S. DeGraff, and Rachel A. Willis studied hundreds of employer-sponsored child-care programs and interviewed some 1,000 employees. Their research demonstrates on-site day care is not only affordable but also profitable. The researchers estimated savings in wages of $150,000 and $250,000 for just two companies that provided on-site day care.
A majority of workers were willing to pay, on average, $125 to $225 per year to subsidize on-site day care—whether or not they had young children. That’s right—even nonparents said they’d chip in, because they believed it would help raise morale and increase productivity.
"It shouldn’t be so surprising that people who work with one another for five or more years should care about one another and that that actually translates into economic behavior," says Connelly. Kids at Work, she notes, offers some models for calculating the benefits.
"Maybe your CEO or HR person can take a risk," adds Connelly. "It can be a case of, ‘If you build it, they will come.’"
Employer-provided on-site day care won’t solve the child-care problem for working families, and in many cases is unrealistic. Let’s face a relevant fact: The real burden of caring for children falls disproportionately on women, who in the U.S. still perform twice as much child care and domestic work as men.
How many working women have employers who could consider providing such services? In the U.S., professional managerial women make up only about 8% of the female workforce, whereas 27% of women hold low-wage blue-collar jobs.
A third of all families with children have incomes not far above the federal poverty level. In New York City, single working mothers (many of them employed in the service sector) suffer the highest rates of poverty. Do we really believe their employers will take up the expense of caring for their children?
Besides, large or small, no employer should be in the business of child care, any more than it should run on-site hospitals, dental clinics, or high schools. On average, children under the age of 5 with working mothers spend 36 hours per week in some type of care. In an era when fewer Americans receive health insurance through work (only 55% now, and the numbers are declining), tying essential child-care services to employment is unrealistic, a poor strategy that doesn’t serve the interests of either working families or businesses.
Families need flexible work schedules, including longer, paid maternity leave for mothers and fathers; access to quality part-time jobs; pre-K and afterschool programs; universal health coverage; and an end to the gender discrimination that privileges men’s work and careers at the expense of women’s earning power.
Evidence suggests paid maternity leave keeps women in the workforce, increases their productivity, and ultimately contributes to the overall competitiveness of the U.S. workforce.
Publicly financed European models offer gender parity, flexible time that’s responsive to the changing needs of maturing families, and increased competitiveness for companies freed from the high 30% benefits load typically carried by U.S. businesses.
On-site day care would seem to promise the best of both worlds—employees working away at maximum productivity while their children are safe and sound—but that’s an illusion. Infants must be nursed. Sick children need to go to the doctor. Eighth-graders need supervision after school.
Nearly all parents, mothers and fathers, wish they had more time for their kids. But the answer isn’t to bring them to work.Opinions expressed in the above Debate Room essays are for the sake of argument and do not necessarily reflect the views of BusinessWeek, BusinessWeek.com, or The McGraw-Hill Companies.
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