The issue of employer-sponsored day care is one that companies of all sizes struggle with. According to the 2014 National Study of Employers, only about seven percent of companies nationwide offer day care "at or near the worksite" (a number that hasn't moved measurably since 2005). On the other hand, about 33 percent of companies that are ranked in Fortune's enviable list of Best Companies to Work For offer an on-campus child care benefit.
But based on the 2014 National Study of Employers, companies of any size do not see the ROI to justify the cost of either onsite day care or vouchers (for offsite day care). In fact, from 2008 to 2014, support for all types of day care by employers is declining (from 2008 to 2014). The same study suggests that all forms of child care benefits are on the decline in favor of more Dependent Care Assistance Plans (DCAPs), which are designed more for elder care, mirroring the need associated with an aging population. Obviously, a key determining factor for the type of child-care benefit was employer size. It's a lot easier to make an expensive on-site commitment as a large employer than a middle market company. Many factors come into play:
- It's a significant financial investment and ongoing commitment.
- The building structure alone is a big expense, often $1M to $2M because of code requirements for kitchens and bathrooms.
- High-caliber and fully trained staff are critical to real success — this isn't a lipstick benefit.
- Security and employee privacy (especially relative to sensitive health needs or requirement) aren't trivial.
- Liability
It's no surprise that employers of all sizes, but especially those in the middle market, find the cost of child care benefits simply too expensive.
In spite of the cost, that's only the economic equation. What's right for each organization is, of course, highly variable and also needs to take into account other perks, rewards, benefits, and most important of all, the size and makeup of the organization's workforce. In general, work-family benefits simply don't provide the ROI that most companies need to justify their cost, but we're reaching a point where benefits in general are becoming less about the hard science of economics and more about the logic of perceptions. In that equation, the question then becomes: what's the right thing to do?
Does your company provide day care?
Dan Munro is an NCMM contributor and a regular contributor for Forbes, where he writes on the intersection of healthcare IT, innovation, and policy. You can follow him on Twitter.