Business waking up to new day-care options
Boston — Talk, talk, talk. For years, it seems that's all corporations have done about child-care benefits for their employees. Numerous newspaper and magazine clippings on this subject reveal the same corporate sponsors being named over and over - so few companies have been active in day care.
A recent survey by the American Management Association in New York showed that while 86 percent of the respondents saw a great need for child-care benefits, only 14 percent are sponsoring such programs.
Consultants in this field, however, say it looks as if sleepy interest is finally waking up to greater participation. Companies are beginning to realize they have options other than costly on-site centers. ''Experimentation with alternatives is what's really new,'' notes Dana Friedman, a child-care consultant and senior fellow at the Conference Board in New York. IBM, for instance, has just launched the first nationwide network on child-care information and referral for its employees. ''One cannot underestimate the impact of IBM,'' Ms. Friedman adds.
At the same time, the awareness factor is high. Stories of child-abuse scandals in New York and California point to the need for good-quality day care. And there is no arguing with the statistics:
''This issue is going to grow,'' Friedman says. ''Eighty percent of women are in their childbearing age; 93 percent expect to get pregnant during their careers and by 1990 two-thirds of new entrants to the work force will be women.'' Single-family households are a significant factor, too. More than 12 million families are maintained by single parents - 10.3 million by women and 2. 1 million by men, according the the Bureau of Labor Statistics.
Slow corporate response
Companies often don't respond to issues unless someone raises them. ''I wouldn't say women are going around demanding child care,'' notes Phyllis Silverman, director of career and family programs at Catalyst, a major women's resource center in New York. Even though the need is there, she explains, women today have too many other concerns - like equal pay and a new management job - to raise the subject.
Companies also favor benefits that all or most of their employees can use, not just parents of young children. After 18 months of a pilot program between the Equitable Life Assurance Society and KinderCare, a national day-care firm, the Equitable bowed out.
''We have hundreds of locations around the country and, to put it simply, KinderCare is not everywhere we are,'' explains Philip Rivera, director of employee relations at the Equitable. ''We wanted to provide a service equally to employees in all locations.'' Now the company sends child-care information kits to its employees and offers a referral service to workers at company headquarters in New York.
Cost was also a factor in this decision, and cost turns out to be the main deterrent to company involvement. Because of the recession, ''the watchwords in employee benefits have been 'cost containment,' '' says Michael Carter, a senior vice-president at Hay-Huggins, the benefits arm of the Hay Group, a human resources consulting firm. According to Hay-Huggins, the national average spent on day care for a child is $4,000 a year.
Little research has been done on the costs and benefits of on-site day care to a corporation. Intermedics Inc., in Freeport, Texas, says its day-care center has saved the company $2 million through lower absenteeism and less need for training.
But Miriam Kertzman, director of Stride Rite's two children's centers in Boston and Cambridge, Mass., believes other benefits - happier employees and a good company image in the community - aren't always measurable. ''I worry that benefits (of financial savings) will be oversold,'' she says.
Alternatives to on-site centers
Slowly, though, the wheels of change are turning. Encouraged by the recovery and the latest management emphasis on long-range planning, executives see logic in providing some kind of child-care help. High-tech companies especially, notes Ms. Silverman at Catalyst, are leaning in this direction because recruitment of top-notch people is so difficult. Businesses in Dallas, San Francisco, and New York are meeting together to swap ideas and experiences with day care and also work out joint programs.
One thing dawning on them, says Dana Friedman, is that there are alternatives to on-site centers which are not so costly, including information and referral services, subsidization, flexible benefits, flexible work hours, and pre-tax salary-reduction programs.
''About 1,000 corporations nationwide provide some form of child care, but I would now jump that up considerably because of (pre-tax) salary-reduction plans, '' Ms. Friedman says. But, she estimates, only about 25 corporations offer vouchers - corporate subsidization that repays part or all of an employee's day-care expense.
'' 'Work and family' seminars are widespread now,'' says Catalyst's Ms. Silverman.
Honeywell has approached issues facing today's working parents through seminars on parenting, a computerized child-care referral service, flexible work hours, brochures on how to choose a day-care center, and in one case, discounts on local day care. ''Honeywell will try to give information and support, but basically parents have the responsibility to handle their lives as they wish,'' says Sonia Cairns, a manager in the company's community responsibility office.
But by far the most talked-about company in diaper-changing rooms is IBM. After three years of research on child-care options, the computer giant settled on a nationwide referral service administered by Work/Family Directions, a joint venture between Rodgers & Associates and Wheelock College in Boston.
Employees weren't asking for help, says Michael Dutton, an IBM spokesman, ''but it was evident (to the company) that trends were pointing toward single-parent families and dual-career families.''
The network provides IBM employees in the United States, Puerto Rico, and the Virgin Islands with information on local facilities suitable to their income and children's needs. IBM funds are also available to help develop child-care centers where there aren't any. The service is not IBM's exclusively and can be subscribed to by other companies.
Is information enough?
Rather surprisingly, parents don't seem to mind that companies are handing out information these days instead of money. ''At the time that you are looking for day care, it's already nerve racking, so you need as much help as possible, '' says Marie Felix, a personnel interviewer at John Hancock Mutual Life in Boston. As a separated parent, she used the Hancock's affiliation with the Child Care Resource Center to find a $260-a-month place for her daughter in a preschool close to work.
Now reunited with her husband, and planning to extend her family, Mrs. Felix is using the resource again, because it offers her a choice, she says. Although John Hancock does not reimburse her, it has contributed $219,000 in the past two years to local centers, one right across the street from corporate headquarters. ''Their donations have given a stamp of approval'' to the centers, she says - an anxiety-reliever at a time when parents are concerned about the quality of child care.
Don't undervalue the role of the corporation as information provider, advises Lee MacKinnon, who runs the corporate operations of the Child Care Resource Center. A number of companies that use the center just for information are now ''thinking ahead to financial assistance.''