It is getting tougher every day to run a successful business without deep corporate pockets. As inflation rages on, everything costs more. While consumers are shelling out more for food, gas, etc., employers are also paying more for the things they need to run their businesses. And now employers are faced with a childcare benefits conundrum. Talk about piling on.
What is that conundrum? The reality is that working parents both want and expect childcare benefits to help reduce their monthly expenses. Employers feel like they need to offer more of those benefits. Yet at the same time, many of them simply cannot afford to. But they also cannot afford to lose valuable workers. See the problem?
It is no secret that American workers have been more willing to leave their jobs in search of greener pastures since the start of the COVID pandemic. What has been termed the Great Resignation continues years after it started. One of the big motivating factors is the result of the pandemic itself: workers reevaluating what is most important to them and their families.
A recent survey of more than 1,000 working adults shows just how serious parents are about childcare benefits. Among working females with children, 67% are concerned that rising childcare costs will negatively impact their careers. Some 44% say they will likely have to change jobs in order to balance childcare and work responsibilities. In addition:
- 55% of working adults say they cannot afford childcare without subsidies or financial assistance.
- 75% said they would utilize childcare benefits if their employers offer them.
- 70% said they would choose an employer with childcare benefits over one without.
- 59% said they would utilize other caregiving benefits if offered.
Interestingly enough, the 75% who said they would utilize childcare benefits if offered are open to a wide range of benefits above and beyond direct financial assistance. For example, they are open to using on-site childcare centers or employer-sponsored childcare that acts as an emergency backup.
The fact that so many working adults are looking to their employers for childcare assistance reminds us that childcare is not cheap. But that is nothing new. We have known for a long time that working parents devote a large chunk of their take-home pay to childcare. But is it reasonable to expect employers to foot the bill?
BenefitMall, a brokerage general agency representing more than 100 insurance carriers, explains that employers have options for helping their workers without actually spending a ton of money. They encourage brokers to look into both financial and non-financial benefits that could directly impact how much families spend on childcare.
On-site daycare centers and employer childcare subsidies would be examples of direct financial benefits. What else can employers do? Flexible scheduling is a start. Flexible scheduling could help working families reduce childcare expenses by either reducing the need to bring in outside help or eliminating it altogether. But there is a caveat: certain types of industries simply cannot accommodate flexible scheduling.
Unfortunately, the childcare conundrum is one both employers and employees need to deal with. It’s a problem with no clear solution. The fact is that childcare expenses continue to rise along with everything else. That’s not going to change as long as inflation continues at its current pace.
In the meantime, employees with children must figure out the best way to cover childcare expenses and still make ends meet. Their employers need to consider helping out or taking the risk of losing their best employees. It is a challenging situation for everyone involved.