Is it possible that child care for employees benefits companies as much as it does the parents who work for them?
The answer – according to an April survey of 1,300 small-business owners by Goldman Sachs – is a definite yes. The June survey results showed that more than half of those surveyed companies – or 55% – believe affordable child care has not been sufficiently addressed in this country and that the lack of it is a barrier to their growth. They also cite insufficient affordable child-care programs in their communities.
More than a one-third of the survey respondents described how employees are forced to cut their work hours or forgo jobs entirely because of child-care challenges. They also believe offering some kind of child care to employees could benefit talent recruitment and retention.
“Small-business owners have made clear that the child-care crisis is exacerbating the biggest challenge they’re facing right now – hiring and retaining qualified employees,” said Jill McCarthy, of Goldman Sachs.
Another study published by the U.S. Chamber of Commerce – the 2022 Parent Confidence Report – showed that employer-sponsored child care is increasingly in demand and that 68% of working parents believe employers should offset its cost.
“We’ve reached a point where child care is no longer an optional benefit,” Dan Figurski, president of KinderCare at Work, noted in the Parent Confidence Report. “It’s just as critical as medical or dental coverage in determining an employer’s ability to retain current employees and attract new hires.”
The expiration of the child tax credit – believed to have lifted millions of children around the country out of poverty – has not helped matters. Nor has the end of the American Rescue Plan’s $24 billion in child-care funding that benefitted three million children, Forbes noted last September. While Congress did advance a bill to reinstate the tax credit, it has languished in the Senate.
Yet without federally funded child care, millions of parents may be forced to stop working. According to the think tank Century Foundation, the economic fallout of that would amount to $10.6 billion in economic activity each year and reduce family earnings by $9 billion.
Parents who are paying for child care are on average shelling out $293 for one toddler and $556 for two, according to 2024 figures from the provider Care.com. But the actual cost of care to a family varies widely based on zip code, a child’s age, and whether a parent is seeking home-based care or center care.
Figures from the U.S. Department of Labor reported by CNN show the annual cost for care of just one child – infant, toddler, pre-school or school-age – can easily eat up 15% to 20% of a median family income in many counties across the country. And even those who can afford care are finding it difficult to find providers.
But COVID, of all things, has sent the message that businesses who want to grow will be left behind without employee child care.
“COVID was a blessing in disguise,” explained Jessica Chang, CEO and co-founder of Upwards, which helps make child care more accessible. “Employers realize that no longer is child care just a social issue, but a business issue,” she told CNN.
“When you have trouble attracting and retaining employees, it affects your bottom line.”
