Child-Care Crisis Think child care is someone else's problem? Think again. The worker shortage makes it a business issue.

Some parents say they need to be on a waiting list for day care even before they conceive.

By Marjolijn Bijlefeld
Imagine an industry with a 40 percent employee turnover rate, soaring demand, stringent rules and regulations, and high customer expectations and you begin to see the challenge of child care.

This service industry is a critical part of the larger economy. When it fails to deliver, all hell breaks loose. Employees of other businesses come in late or are absent. Sometimes when they do make it in, they’re distracted. Or — because of lack of available, affordable quality care — they simply quit.

Child-care concerns have always been a cause of anxiety for working parents. Academics can cite plenty of reasons why it’s an issue: The work force is made up of dual-career couples. There are more parents raising kids alone. Our mobile society has broken up extended-family networks.

Whatever the cause, today’s 2.9 percent unemployment rate makes child care an even more pressing issue for businesses trying to attract and retain working parents. The same economy that lets valued employees shop for the job with the best balance between work and family is the same economy that is pulling workers out of child-care positions, which typically pay $7 an hour.

It’s being called a child-care crisis. It won’t solve itself, and the government can’t fix it alone. But businesses are only just beginning to get involved. In February, a Northern Virginia group called the Employer Child Care Council presented a 20-page report to the Fairfax County Board of Supervisors outlining the problem and encouraging action.

The council noted an increase in the demand for child care: More parents are requesting information about care, and there has been a 16 percent increase in the number of children in county-subsidized care. At the same time, centers are having a hard time finding qualified workers. In the past two years, the number of home childcare providers with a county-issued permit dropped 16 percent while the county’s population rose 2 percent. Other localities face similar problems, and the numbers don’t even take into account unlicensed and under-the-table care.

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The involvement of businesses is a new phenomenon. Right now, foundations and businesses cover 1 percent of child-care costs nationwide, says Suzanne Clark Johnson, executive director of Action Alliance for Virginia’s Children and Youth, a Richmond-based nonprofit advocacy group. Without support from businesses, talented employees will continue exiting the work force, she predicts.

Jeff Bechtle and his wife are expecting their first baby this summer. He was a preschool teacher in a Fairfax County child-care center. Ideally he would have been able to bring his child with him, but the center where he worked doesn’t accept infants. Regulations require a higher ratio of care-givers for younger children, so infant care often isn’t profitable for centers. The Vienna couple decided that, on a preschool teacher’s salary, it wasn’t worth paying for care elsewhere.

Until her second child was born last March, Sheila Carter-Tod was an English professor at Wytheville Community College. With her first child, she had an ideal setup: a well-qualified sitter who came to her home and gave her daughter one-on-one attention. Carter-Tod had planned to take a leave of absence until her second child was 9 months old, then return to work. The search for care was frustrating. She was often told 30 people had called before her for one slot in a private home. Day-care centers wouldn’t take the infant. When she couldn’t find the care she wanted, she resigned.

"The economy is too strong for people to want to care for other people’s children right now. And I didn’t want [my daughters] to be in a place where workers felt like this was the only job they could get," she says. Without the security of knowing her children were well cared for, this Ph.D. knew she would be in a "constant mode of anxious functioning." Her teaching post wasn’t filled when the semester began in January.

Some are lucky. Jackie Will, of Virginia Beach, found a well-run center for her two children. The center even feeds them dinner one night a week, allowing her to run some extra errands after work. Her husband is in the military, and his tours have him gone nearly as much as he’s home. Will’s job also requires travel. If her husband’s not home, that means flying the children to Omaha, Neb., where her family lives. The juggling act is most difficult when the children are sick, as they were for a week and a half this winter. Her only option was to take vacation time to care for them.

The Fairfax Employer Child Care Council notes that without qualified and willing workers, child-care centers can’t expand. The council, which includes representatives from some of the county’s major employers, recommends some public-private strategies. One is to use technology to help parents find up-to-date child-care information on the county’s Office for Children Web pages. The council also wants a multimedia campaign to promote child-care careers. A campaign could "create positive images about working in the child-care field," the report says.

These aren’t particularly new strategies. Indeed, the Office for Children conducted a recruitment campaign like the one proposed in the early 1990s, with funding from Mobil Corp. What’s significant is the collective caliber of Fairfax’s public-private effort. Companies represented on the 17-member council include such heavy hitters as American Management Systems, Arthur Andersen, Bank of America, GTE, Freddie Mac, Inova Fairfax Hospital and TRW Systems Information Technology Group.

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Child care in Virginia is "quite poor and deteriorating," Johnson says. She adds that the state’s goal of providing affordable child care for new workers coming off welfare doesn’t begin to address the problem.

"The [Gilmore] administration believes that the market will pretty much take care of quality issues, just as it does with other commodities. I don’t think anybody who truly cares about children would say, ‘Let’s let the laws of supply and demand operate and see how they affect our children.’"

She says it’s time to move the issue off the back burner: Early childhood learning is an indicator of later school success. You want a prepared and intelligent work force in two decades? That depends on children entering school prepared to learn. What’s more, workers with unsatisfactory child-care arrangements have higher rates of absenteeism, are more likely to be late and are more distracted during work. Failing to find child care is one of the top reasons that people moving from welfare to the job market lose their jobs, Johnson says.

But many businesses throw up their hands, thinking the only solution is an on-site child-care facility. There are other ways to help employees — some of which don’t cost a cent.

Set up discount relationships: Leslie Day of Day Consulting, a Hampton-based human resources consultant, suggests this strategy as a minimum commitment. Several of the national franchise child-care centers, including KinderCare and Children’s World, provide discounts, typically 10 percent, to employers who ask. To find out more, call a local franchise center and ask where to call for the employer discount. You’ll be referred to a regional or corporate office.

Join the Y: Many YMCAs also offer child care. Employers can benefit working parents and non-parents alike by subsidizing Y memberships. "It’s a double benefit: Not only do the parents have access to that child-care option, all employees gain the health benefit of having access to the facility," Day says.

Subsidize child care: Helping offset the cost of child care can be an enormous benefit to employees. A similar option is to pay for the registration, or even costs, of an occasional or sick-child facility or even summer program. That way workers won’t have to miss an important event because a child has the sniffles or because the regular care provider is out on an important work day.

Offer flex time: Flexible work arrangements can be extremely helpful to working parents. It’s not a direct child-care initiative, but many parents use it that way, says Cynthia C. Weidner, a senior benefits consultant with William M. Mercer Inc. in Richmond. Mercer recently conducted a survey of 400 companies and found that 42 percent of respondents said flexible work arrangements were the work-life benefit of greatest value, compared with 20 percent who found direct child-care benefits of greatest value.

Allow telecommuting: Even telecommuting parents need child-care arrangements, but there’s more flexibility. Consultant Day suggests that when bad weather threatens, consider sending employees home with work. That allows them to get the critical things done and still be paid for the day.

Establish dependent spending plans: This requires more administration by employers. These plans allow employees to pay for child care with pretax money. It also benefits the companies, which save on some Social Security and Medicare taxes.

Create a small business loan pool: Johnson says some businesses have underwritten a small business loan pool so local child-care providers can borrow money at low interest to improve or expand a facility. While the centers don’t look like a good risk to most traditional funding sources, the rate of payback is high. "This option doesn’t cost money in the long run and helps build capacity now," she says.

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Adding on-site child care is a high-end solution, but it does work. McCord Consumer Direct is an airline reservations call center in Newport News. The business started in 1996 and operates around the clock. "We have a diversified work force, and the majority [are] women and single parents. We didn’t know much about child care so we researched it, conducted surveys and focus groups, and got the employees involved," says Shawn Marston, director of human resources and general affairs.

The company found that if it could provide child care on site, productivity and performance would increase and absenteeism and anxiety would decrease. McCord’s specialty, however, wasn’t child care. It asked for proposals from local care providers and selected Bellwood Tender Care, a company with a 20-year history in the area, to operate the center.

In August 1998, the company opened the McCord Learning Center, a 7,000-square-foot space carved out of a 40,000-square-foot building. It’s open seven days a week from 6 a.m. to 2 a.m. There’s a nursery, a computer room, a sick room, a playroom and a full kitchen, so parents can share meals with their children.

About 100 youngsters are enrolled. Half are children of McCord employees and the other half come from the community. McCord subsidizes some of the cost for its employees. The workers appreciate that benefit, of course, although Marston stresses that these aren’t minimum-wage call center jobs. Agents work on an hourly basis plus commission and average at least $15 an hour.

The center makes business sense for the company and its 280 employees. "The bottom line is, if people are happy, they’ll stay and grow with us." The company has been recognized by the U.S. Department of Labor’s business-to-business mentoring initiative on child care. The department’s women’s bureau presented an award to the company last June. As a mentor, McCord will provide guidance and technical assistance to other employers interested in developing on-site learning centers and other family-friendly programs.

Other companies have also found that on-site centers help attract and retain quality employees. Sharon Stottlemyer is the manager at Kids’ Station at MediCorp Health Systems, which includes Mary Washington Hospital in Fredericksburg. Kids’ Station started in a small house and enrolled 48 children. When the new hospital was built, Kids’ Station also got new digs and expanded to care for 175 children.

It has since grown: It now enrolls 300, and the organization is considering another expansion. The center has a staff of 47 and is open from 6 a.m. to 8 p.m. weekdays, as well as most holidays. "Even if school is canceled because of snow, we need our associates to come to work," Stottlemyer says.

Wilemina DeShazo, vice president of human resources for MediCorp, says Kids’ Station is a definite attraction. "Anything we can do to make an associate’s life easier at work, we want to do that." There’s a tight market for health care workers. The center makes it easier to recruit nurses, technicians and service workers who have young children or are thinking of starting a family. The ability to attract and keep good employees is worth the cost. "Kids’ Station is not a moneymaker," DeShazo says. "It holds its own or may even break even, but it means so much to the associates."

Other businesses agree and take a longer view. As the Employer Child Care Council in Fairfax County notes in its report: "The business environment of the future will require a highly skilled labor force with increased literacy and problem-solving skills. Current research is clearly documenting the importance of early experiences in providing a foundation for future success in school, at the workplace and in life." They’d rather pay now than pay later.