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Child care is critical for helping to keep women in the workforce, and for closing the gender gap. Child care is also a business imperative.
In fact, companies lose up to $70 billion a year due to child care disruptions (think: sick days, school breaks, and early dismissals), uncovers a new report that includes a national survey of about 1,700 parents by Moms First’s National Business Coalition for Child Care, in partnership with McKinsey & Company. The report finds this lost worker output caused by child care disruptions is equal to adding more than 1.2 million full-time workers to the economy.
“We often think about infrastructure as roads, ports, or power grids—but child care plays a similarly critical role,” said Ramya Parthasarathy, partner at McKinsey & Company, in a press release. “It enables millions of workers to participate in the economy each day, and when access is disrupted, businesses see the impact through absenteeism, turnover, and lost productivity.”
The same report finds that nine in 10 parents say child care disruptions impact their ability to work, but only 15% of companies offer child care benefits.
“At the core, child care is the linchpin of workforce participation and affordability,” says Reshma Saujani, founder and CEO of Moms First. “Nearly 500,000 women left the workforce last year, mostly moms of young children who couldn’t access or afford care. This is not a side issue, it determines whether people can work at all. You can’t have a functioning economy if people can’t afford to show up to work.”
We’re seeing some policy advancements help fill in the childcare gaps, such as New Mexico being the first state to offer free universal child care, and New York City following suit by offering free pre-K for children as young as two years old. In the meantime, it may be in businesses’ best interest to provide child care support for employees who are still waiting for policy to catch up.
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The Moms First report finds that child care disruptions disproportionately impact women in the workplace. Women report about 11% more days being at work but not fully productive and about 21% more time absent from work than their male counterparts.
“Child care breakdowns don’t hit everyone equally, they hit women first and hardest, especially moms in foundational jobs that don’t offer flexibility or remote work,” says Saujani. “When care falls apart, it’s women who absorb the shock first and pay the highest price.”
Addressing the child care crisis for foundational workers in particular, or those in shift-based, operationally essential roles such as nurses, teachers, or retail workers, could save employers roughly $35 to $45 billion in increased worker output, according to the report.
“Foundational workers are the backbone of the U.S. economy,” says Saujani. “They are nearly 80% of the workforce. They are the ones who keep hospitals, classrooms, factories, hotels, and restaurants running every day.”
The national average for child care is $13,000 a year per child, according to an analysis by the Century Foundation. For some foundational workers, such as those in retail or hospitality, lower wages can make child care unaffordable. For foundational workers in healthcare such as nurses, last-minute disruptions like school cancellations can mean missing their shift.
“Having more stable child care options, such as onsite child care, would be life-changing,” says Katherine DeOrdio, 42, a nurse practitioner based in Syracuse, New York and mother of three children under 12 years old. “It would save me so much time, stress, and money in trying to find last-minute care, and would help me to better focus at work. Also, I’d be able to pick up more shifts.”
For many employees, child care breakdowns can lead to missed work days, presenteeism (or reduced output), and even leaving a job.
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Giving parents access to trusted and reliable child care options matters to workplaces because when child care is unstable, workers may be less productive and engaged, and teams have less continuity.
“Child care disruptions are a direct driver of business loss through absenteeism, turnover, and reduced productivity,” says Saujani. “That’s not a personal issue, it’s a business one.”
For many employees, child care breakdowns can lead to missed work days, presenteeism (or reduced output), and even leaving a job. On the other hand, offering child care support may benefit companies in terms of being able to better attract and retain parents, and boost productivity when parents can focus on work instead of finding backup care.
There is an opportunity for employers to support their employees who need child care, which also benefits team continuity and their bottom line, by offering child care interventions. Examples include backup care, onsite child care, employees’ ability to choose their schedule, and child care credits.
“Every child care investment we studied delivers a positive ROI. Every single one,” says Saujani. The average ROI for businesses offering child care interventions range from 5% to 300%, depending on the type. Offering flexibility where its possible for a role has the biggest impact. For example, the report finds a 280% to 300% ROI for employers who let workers choose their schedule. Making child care more accessible, such as by offering care navigation support, can have a 120% to 140% ROI. Making child care more affordable, such as by offering child care reimbursements, can have a 70% to 90% ROI.
The types of interventions depend on the job, of course. For example, foundational workers who have to show up in person to do their job, such as nurses, more highly value options such as onsite child care and child care reimbursements, while those outside the foundational workforce, such as knowledge workers, may prefer remote and hybrid work options.
“There is no one-size-fits-all solution, but the data is clear: when employers listen to their workforce and invest in what they need—whether it’s stipends, backup care, or flexibility—it pays off,” says Saujani. “Employers can’t solve the child care crisis alone, but they can’t afford to sit back and wait for someone else to fix it either.”
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