The Lasting Impact of Employer-Sponsored Child Care UNITED KINGDOM AND IRELAND A Report from The Consulting Practice at Bright Horizons
Executive Summary Current estimates indicate that 40 percent of employees in the UK have dependent children. 1 In fact, the number of working parents is currently at a 15-year high 44 percent of families with children under the age of two have both parents at work. 2 Furthermore, rising living costs will continue to contribute to the trend of both parents working. Integrating work responsibilities with caring for children challenges a substantial portion of the workforce. Government initiatives, such as tax exemptions and credits and the Nursery Education Grant, ease some of the financial burden on working parents, but more help is needed. Working families are looking for affordable, reliable, and high-quality child care available near home or work at times when they need it to support their work patterns. Many look to their employers to fill this gap. In January 2009, The Consulting Practice at Bright Horizons launched a study to measure the effect of employer-sponsored child care on working parents in the United Kingdom and Ireland. The group heard from more than 350 parents who utilised an employer-sponsored nursery at 33 organisations throughout England, Scotland, Wales, and Ireland. The analysis of this data provides a comprehensive examination of the value of employer-sponsored child care to the workforce and the potential repercussions on organisations that do not provide this work/life support. For example, the study shows that of parents using an employer-sponsored nursery: 83 percent of respondents rate their workplace nursery as the best or among the best benefits their employer offers 96 percent indicate that the presence of a nursery at their place of employment was important in their decision to join their company; 40 percent indicate that it was very important 93 percent of respondents say that a workplace nursery would be an important factor in considering a job change, while more than one in five respondents have actually either turned down or declined to pursue a new job option due to a lack of workplace child care at the other employer 27 percent of respondents report that they could not work without the workplace nursery 1 The Department of Trade and Industry 2 uswitch.com
Employers Note the Impact A Must-Have Benefit Employees who use a nursery sponsored by their employer clearly see the nursery as a top benefit. More than one-quarter of nursery users report that it is the best benefit offered and close to 60 percent say that the nursery is among the best benefits. We wanted to help our people ease the burden of managing work and child care responsibilities by making some changes that make a difference to those employees. How do you rate your workplace nursery benefit in comparison to other benefits offered by your employer? N=344 Neil Roden, Head of Human Resources, RBS 83% consider the benefit to be the best or among the best offered 26% 57% 15% 0% 20% 40% 60% 80% 100% Best benefit offered Among the best benefits Equal to other benefits We have implemented a tremendous amount of change, but the opening of our on-site nursery represented not only the single biggest investment made, but also the initiative that made us feel most proud. Having a workplace nursery is of the utmost importance to me and comes above any other priorities. I can t emphasise just how much this means to me and my ability to get on with my job. High-quality child care is of immeasurable importance. Without it we would not be happy to both work. The opening hours are great for me and allow me to give 100 percent to my job while my children are cared for. June Lynch, Finance Director, Kwik-Fit Our nursery has expanded and become an integral part of university life, providing not only excellent quality child care for students, staff, and members of the wider Aberdeen community, but also forging crosscurricular links across the university s faculties to mutual benefit. Christine Buchanan, Dean of Students, Robert Gordon University
Attracting and Retaining Key Talent Despite short-term downsizing in many organisations, employers in all industries remain concerned about labour and talent shortages over the next decade. Findings show that employer-sponsored child care assists employers in meeting their recruitment and retention goals: Of those respondents who at the time they were recruited had children and whose organisation offered a workplace nursery, 96 percent indicate that the presence of child care at their place of employment was important in their decision to join their company; 40 percent indicate that it was very important 27 percent of respondents report that they could not work without the workplace nursery Deciding to Stay Percentage who have seriously considered leaving their employer in the past six months due to child care difficulties 15% 12% 9% 6% 3% 0% 13% Control Group N=481 Nursery users are 78 percent less likely to consider leaving their employer due to child care issues 3% Nursery Users N=348 Conversely, employers without employer-sponsored child care may risk losing key staff. The Lasting Impact survey respondents were compared with a control group* of employees from the more general population of working parents in the UK and Ireland from The Consulting Practice s survey database (N= 481). The comparison found that workplace nursery users were almost 80 percent less likely to consider leaving their jobs in the past six months due to child care difficulties than those in the control group. My workplace nursery is excellent and is one of the main reasons that I stay with my employer. Increasing Engagement Access to a workplace nursery increases employee engagement, fostering a positive impression of the company. Nearly 90 percent of respondents say that access to their workplace nursery helps them integrate work and family life, while three-quarters believe their employer promotes work/life balance and feel valued as an employee. Seventy-one percent feel more positive about their organisation because of access to their workplace nursery. Because my employer sponsors a workplace nursery... N varies 343-346 I am able to maintain a healthy balance between my work and personal life. 88% I feel that my organisation champions and promotes work/life balance. I feel that my organisation values me as an employee. I have an increased feeling of goodwill towards my organisation. 75% 75% 71% I am willing to give extra effort to help my organisation succeed. 63% 0% 20% 40% 60% 80% 100% *Note: The control group consists of The Consulting Practice s proprietary survey database, a repository of results from child care needs assessment studies conducted in the United Kingdom, with nearly 2,500 respondents over the past eight years who may or may not have access to workplace child care.
Getting the Job Done Employees have reported that their workplace nursery positively affects their productivity at work and ability to be successful in their job. In fact, 85 percent say that their nursery positively affects their ability to concentrate and be as productive as possible. Three-quarters say that their nursery allows them to meet job performance expectations. I know my child is given love and attention when I leave him. I have no worries about him throughout the day, which leaves me to concentrate on work. Access to a workplace nursery positively affects ability to... (N varies 290-336) Concentrate and be as productive as possible 85% Meet job performance expectations Participate in training Provide good customer service 76% 74% 70% Pursue or accept a higher position 0% 20% 40% 60% 80% 100% 70% Reducing Absenteeism Absenteeism is costly to an organisation. As shown in the chart below, employees with access to workplace nurseries are much less likely to miss work due to a breakdown in child care than the control group* of employees. Reduction in Absenteeism Percentage who have missed work in the past six months due to a breakdown in care 25% 20% 15% 10% 5% 0% 22% Control Group N=1,508 Among nursery users, there is a 70 percent reduction in number of days missed due to child care issues 7% Nursery Users N=348 Workplace nurseries have a major impact on an employee s decision to remain with his or her employer. One in five nursery users have either turned down or declined to pursue a new job opportunity due to a lack of a workplace nursery at the other employer.
As a further aid to support productivity and reduce absenteeism, many employers are providing back-up child care solutions to employees so that they are supported should they have an unexpected breakdown in their usual care arrangements. A Valuable Resource for Key Contributors The majority (84 percent) of the respondents to the survey fell between the ages of 31 and 45. Additionally, 78 percent of respondents have at least five years of tenure at their organisations while just under 40 percent have been with their organisations for more than 10 years. Nursery users in this survey comprise a cohort that holds valuable intellectual capital and would be costly to replace. Age of Respondents N=346 My child receives excellent care. The people that work there do a brilliant job, and I don t feel I could have come back to work without their help and support. 50% 40% 30% 20% 10% 1% 0% 25 26-30 or younger 84% are mid-career employees 34% 36% 14% 14% 31-35 36-40 41-45 1% 1% 46-50 Tenure of Respondents N=348 51-55 50% 78% have 5+ years of tenure 87 percent of respondents said that their workplace nursery was important in their decision to return to their present employer after the birth or adoption of a child 40% 30% 20% 10% 0% 14% 3% Less than 1 year 19% 1-4 years 40% 5-10 years 38% More than 10 years
Affordability Although survey participants were not specifically asked questions relating to the affordability of child care, many respondents voluntarily commented that affordability is a key concern. Today s tendency toward a more dispersed population, where employees may live and work some distance from their families, makes sourcing free or low-cost informal care arrangements increasingly challenging for working parents. At the same time, the cost of formal child care has consistently risen above the rate of inflation and average wage increases in recent years. 3 Working parents are seeking high-quality care that is also affordable and accessible to give them peace of mind and the ability to focus and perform at work. Meanwhile employers are looking for cost-effective ways in which to support working parents need to balance work and home life. Employer-supported workplace nursery provision enables employers to positively influence cost, accessibility, and quality for their families. The Government has gone some way to incentivise employers to support child care through Tax and National Insurance Contribution (NIC) exemptions. In the UK, child care vouchers qualify for Tax and NIC savings, subject to a weekly limit, and workplace nurseries are fully exempt from Tax and NICs, subject to HMRC s qualifying criteria being satisfied. 3 According to the Daycare Trust s 8th Annual Childcare Costs Survey (2009), the typical cost of a full-time nursery place for a child under the age of 2 is 167 a week in England, compared with average earnings of 479 per week, bringing child care costs to approximately 35 percent of one s earnings. Apart from the significant financial savings, we have comfort knowing that our little girl is in capable and experienced hands. As a single mother, the savings from the nursery really go a long way to making things easier. Methodology In January 2009, The Consulting Practice at Bright Horizons launched a study to measure the impact of employer-sponsored child care. Parents with children at Bright Horizons employer-sponsored nurseries were given the opportunity to complete an anonymous survey upon the conclusion of Bright Horizons annual Parent Satisfaction Survey. The purpose of the survey was to identify what impact employer-sponsored nurseries have on the employees and employers who utilise them. The findings presented here include only the results for parents who indicated that they work for the sponsoring employer. There were 354 of these respondents to the survey, 85 percent of whom were women. The majority of respondents (87 percent) lived in two-adult households, in which both adults are employed or in education more than 20 hours per week. Eight percent lived in two-adult households with one adult employed or in education more than 20 hours per week and 5 percent lived in a single-parent household. All respondents had caregiving responsibilities for children under the age of six. Thirteen percent also cared for children aged six to twelve and 3 percent were also responsible for children aged thirteen to eighteen.
About The Consulting Practice at Bright Horizons The Consulting Practice at Bright Horizons partners with employers across industries to provide services designed to help increase the effectiveness of their people strategy. To learn more about this study or other studies, please contact lastingimpactuk@brighthorizons.com. To learn more about this study or Bright Horizons, please contact lastingimpactuk@brighthorizons.com. Tel: 01933 415971 www.brighthorizons.co.uk 2009, Bright Horizons Family Solutions LLC