Dive Brief:
- Child care benefits result in a range of positive financial impacts for companies, including a return on investment of up to 425%, according to an analysis by working parent advocacy group Moms First and Boston Consulting Group.
- The study looked at five companies with child care benefits — Steamboat, Fast Retailing, UPS, Synchrony and Etsy — and used HR data, worker interviews and surveys to deduce ROI. The “conservative approach” looked qualitatively at retention, productivity and presence.
- “It’s not just the money, it’s the principle. It feels like a ‘thank you.’ It’s an incredible morale booster,” a corporate employee at Fast Retailing told surveyors.
Dive Insight:
Moms First and Boston Consulting Group looked at a variety of child care benefits, but researchers were particularly interested in those benefits that went “above and beyond” the more standard approach of paid parental leave, dependent care FSAs and employee assistance programs.
Fast Retailing provides monthly stipends of $1,000, which employees may use for up to three years for children up to 6.5 years old. The case study followed a store manager with 11 years at the company, who, due to the cost of child care, considered leaving after becoming pregnant with twins. With access to the stipend, however, she decided to stay.
Colorado ski resort Steamboat provides a near-site child care center, for which employees receive priority registration and discounted tuition, and UPS offers an emergency on-site daycare for when workers’ typical arrangements fall through. The programs have resulted in reduced absences and better retention, the study found. A national sales manager at Steamboat noted that the near-site child care center allowed her to continue nursing her daughter after she returned to work.
Crucially, extra child care support appears to inspire loyalty even beyond the benefits of the programs. “Even if another company offered me more money tomorrow, I wouldn’t even consider it, given how much this company has invested in my personal life,” a senior director at Etsy who has used the company’s backup child care benefit told researchers.
Child care difficulties caused by illness, unreliable providers and lack of available care have long driven workers, especially mothers, from the workforce. In addition to offering benefits, some employers have explored and adopted unconventional solutions, such as Latched Mama, an apparel company located outside Richmond, Virginia, which invites workers to bring their young children on-site.
“There are so many people who have failed at the beginning of business, and we haven’t,” Melissa Wirt, CEO and founder of Latched Mama, previously told HR Dive. “I will say until I’m blue in the face that it’s because I saw value in a group of people that society overlooked so much.”