Walk into any well-run early learning/child care facility, and you'll likely be floored by an assault of cuteness: happy children working on art projects, being read to by caring teachers and eating nutritious snacks.
What employer, if it had the means to do so, wouldn't want to offer such a facility as a benefit to its employees?
Especially since research shows that onsite child care is something workers want, even ones who don't have children. In the book "Kids at Work: The Value of Employer-Sponsored On-Site Child Care Centers," economists Rachel Connelly and Deborah DeGraff and professor Rachel Willis detail the findings from their two-year study of more than 900 employees at three companies, which reveal that a majority of workers would be willing to pay an average of $125 to $225 per year to subsidize an onsite child care facility - regardless of whether they had young children.
Further, "for two of the companies, onsite child care helped to attract and retain a certain subset of workers that it would have been hard for them to get otherwise," DeGraff told Bowdoin College in 2005, not long after the book was released.
"We used our estimates of the value of the onsite child care reported by this subset as an estimate of what firms without onsite child care would have had to pay in higher wages to all of its employees to attract and retain the workforce that it needed. It was substantial," she added.
Substantial, indeed. By such calculations, the researchers estimated that the employers studied could save $150,000 and $250,000 in wages by providing onsite child care.
However, there's more than cuteness and savings involved in opening an onsite child care facility, as any savvy benefits professional knows.
In a session at EBN's Benefits Forum & Expo this fall, Heather Adams, corporate director of dependent care services at Baptist Health South Florida, and Andrea Wicks Bowles, senior consultant in the consulting practice at Bright Horizons, laid out both the costs and benefits of providing onsite child care so employers can make an informed decision about opening a center.
Baptist Health South Florida
The largest private employer in South Florida, BHSF employs more than 13,000 workers across seven locations. The organization currently operates three early-learning centers, and is about to open a fourth in a new hospital scheduled to open next year.
The early learning centers serve some 243 children, and are open to employees' children from age 6 weeks to 5 years.
To give employers an idea of the size and scope of BHSF's onsite child care operation, the lion's share of Adams' role is making sure standards, service and enrollment at the learning centers all remain high. Part of that role is overseeing the state licensing and standards compliance for all three centers - no small feat that includes maintaining insurance, teacher credentials and curriculum criteria.
Her advice to like-minded employers looking to open an onsite center: "The first thing you have to ask yourself is, 'What are your goals?'" Adams said. "Right now, we have a program that's very high standards, so we're thinking about how we can add more children to classrooms without hurting the quality of the centers."
In terms of the checks and safeguards needed to retain quality, "We have insurance covering the children if they get hurt. We are governed by licensing, so we have to follow the law, which makes things very clear. Plus, we went one step further and decided we wanted to be nationally accredited, so there are many indicators that we have to go by to meet those national quality standards," Adams said.
"What we have found is that parents like onsite, first and foremost, but the next thing they're looking for is quality. So, you can't beat it if you have both of them," she added. Meeting quality standards is a tall order, as fewer than one in 10 meets standards sets by the National Association for the Education of Young Children.
And since she can't be everywhere at once, Adams relies on multiple feedback outlets to ensure all standards are being met and that teachers, children and parents are satisfied. "We conduct annual surveys of parents and teachers; we have leadership meetings, teacher meetings, parent meetings," she said. "We're constantly talking and getting feedback, constantly communicating. We're not shy. So if there's an issue, I hear about it."
Legal liability
One of the potential issues, as Wicks Bowles pointed out, is legal liability should the worst occur - a child's injury or death, or improper conduct by a teacher.
"Legal liability is a big, big deal," Wicks Bowles said. "One of the big draws for an employer is that [by sponsoring onsite child care through Bright Horizons] you can have the liability covered by us - not just the physical space of the center, but also who you're hiring. We carry incredible insurance, but also have serious infrastructure to make sure good things are happening every day and we know what's going on. You absolutely have to have that liability question figured out."
It's definitely a question on employers' minds, as a survey by Public Agenda found that more than half (59%) of employers cited the responsibility and potential legal liability as reasons against opening an onsite child care facility.
The benefits, by the numbers
For employers that can afford the high start-up costs of opening an onsite child care facility - estimates are around $700 to $1,000 per child - the benefits are high as well, Adams and Wicks Bowles said.
"What we've found is that the return on investment is a 60% increase in retention rate among employees who use this service," Adams said. "And they continue to have more children and stay for a long time. It seems like they stay forever. We've saved $7 million a year for each percentage decrease in turnover. Turnover has decreased in the last two years, saving us $37 million."
But it's not just about the savings, she emphasized. "We're very committed to providing supports for children and families. We look at this not only as caring for the child, but also caring for the parent."
Wicks Bowles acknowledged that in tough economic times, it can be difficult for HR/benefit practitioners to make the business case for a benefit that only directly serves a small segment of an employee population.
However, she countered: "With family benefits, it's great that you're serving 250 kids or 250 employees that you serve directly, but you've got umpteen hundred coworkers who are working in teams with those employees who are now more focused and engaged."
As Connelly explained her research to Bowdoin, "I was impressed with the near universality of positive feeling workers showed about working for a company that had a child care center. They liked the idea that their company took care of the person who worked down the row from them."
Wicks Bowles concurred: "It's not just the halo effect; it's being thought of as a place that cares for the whole person, having a workplace that recognizes the wholeness of your employees."
She added that the warm-fuzzy aspects don't detract from the numbers that support the positive ROI that can be achieved through worksite child care.
"I could go on and on from a passionate standpoint, but the fact is there are some real, measureable business impacts from family care benefits. People have lower stress levels, fewer incidences of depression, plus the positive effects on co-workers. [Making the case] that it's the right thing to do, it's a good thing to do gets more difficult as the economy gets toxic. So, it's good to have those numbers."
