Why businesses should be concerned about child care challenges
Solving the child care challenge in our region is obviously not simple or it would have been done by now.
And there would no need to hold a childcare summit like the one that 7 Rivers Alliance, The Parenting Place, La Crosse Area Development Corporation and the La Crosse Area Society for Human Resource Management is holding in La Crosse on April 23.
But after spending the last year working on the challenge of not having enough child care in the region, I am convinced of at least one thing: Businesses should be more engaged in the process. Because if they are involved it will likely improve their bottom line.
Let me emphasize that I am not suggesting that every business have its own child care center. That’s an option for a few, but not for many. Other options include child care subsidies, working with existing centers to guarantee slots and other ideas.
Every business needs to keep a close eye on the bottom line. And I can guarantee that our region’s lack of child care impacts their finances.
But if I told you that making a specific investment in your business would not only result in a positive return but also improvement in your employee retention and recruitment, would you be interested?
Because those are the results -- according to research -- when businesses become involved with child care. Employees who have access to consistent and reliable child care are more productive, have lower absentee rates and lower turnover.
Let’s look at some of the productivity costs. A group working on child care in Jackson County that the 7 Rivers Alliance is a part of did a survey last year of parents. One of the questions asked in the survey was:
“How much time do you spend making alternative child care arrangements during our work hours? This includes arranging for early school releases, snow days, etc.”
The answers were:
Less than 1 hour per month: 34%
1-2 hours per month: 29%
3-4 hours per month: 15%
5 or more hours per month: 7%
So what does this mean? Using workforce data from the the Wisconsin Department of Workforce Development 2017 Jackson County Workforce Profile, I was able to calculate what these answers mean.
It should be noted that dollar amounts reflect a total loss of productivity. Actual productivity loss will vary by sector as there would likely be some work done during that time. It also doesn’t take into account time lost from work that was covered by benefits such as vacation or sick time which would be paid out anyway.
There are 758 employees work work in the manufacturing sector in Jackson County. The average pay rate is $22 per hour.
34% = 258 employees = 1 hour per month = $5,676
29% = 220 employees = 1.5 hours per month (average of 1 and 2) = $7,260
15% = 114 employees = 3.5 hours per month (average of 3 and 4) = $8,778
Total manufacturing lost productivity = $21,714 per month or $260,568 per year
Trade, Transportation and Utilities
2,099 employees with annual payroll of $68 million or $16 per hour
34% = 714 employees = 1 hour per month = $11,424
29% = 609 employees = 1.5 hours per month = $14,616
15% = 315 employees = 3.5 hours per month = $28,665
Total trade, transportation and utilities lost productivity = $54,705 per month or $656,460 per year
8,614 employees with annual payroll of $38,952 or $18.73 per hour
34% = 2,929 employees = 1 hour per month = $54,860
29% = 2,498 employees = 1.5 hours per month = $70,181
15% = 1,292 employees = 3.5 hours per month = $84,697
All industries lost productivity = $209,738 per month or $2,516,857 per year.
I repeat -- the cost to businesses in Jackson County because of employee child care issues is more than $2.5 million a year. Again, these are not perfect numbers, but it gives you some idea of the cost to businesses when employees are dealing with child care issues on company time.
But there are other costs as well -- and not just to businesses but to families and parents. Another question in the Jackson County survey asked: “How have your child care arrangements interfered with your employment (check all that apply).”
I have been absent from work due to child care issues: 68%
I have been late for work due to child care issues: 56%
I was unable to work overtime due to child care issues: 68%
I have been charged a fee due to late pick up when I have stayed at work beyond my regular work schedule: 21%
Due to stress and concern about my child care arrangement, there are times when I cannot work to my full capacity: 50%
Absenteeism, showing up late, not being able to work overtime -- these are bottom line costs to the business. It’s harder to measure the emotional and social costs to parents who can’t work to their full capacity because they’re worried about their child care.
So why should businesses care about their employees’ access to child care? Because it affects them -- one way or another.
If you’d like to learn more about the problems and potential solutions to our region’s child care challenge, attend our summit.
Tickets are $25 for 7 Rivers Alliance members and $30 for non members. Purchase tickets here! https://www.eventbrite.com/e/childcare-summit-tickets-57020942173
Chris Hardie, CEO