Early Childcare: Challenges for Businesses

The childcare crisis in America is a social issue as well as a significant economic concern and one of the biggest challenges for businesses. Businesses have a role in supporting solutions. Acknowledging and addressing the impact of insufficient childcare on the workforce is one piece. The other is to look at the shrinking childcare infrastructure. By doing this , businesses can contribute to a more resilient and productive economy.

In San Antonio, there are simply too few childcare centers to effectively support the city’s workforce. The economic impact of these centers operating at 70% capacity or less and continuing to close is alarming for families and the businesses that call San Antonio home.

Lack of Childcare Impacts Business

According to Nonprofit Quarterly, high childcare costs force many parents, especially mothers, to leave the workforce. This leads to employee shortages and reduced productivity for employers. In addition, other issues include:

Since the pandemic, when 4.2 million women exited the labor force, businesses have become increasingly aware of the implications of childcare disruptions.
In Bexar County, there are more than 132,000 children under age five, yet fewer than half have access to regulated early learning care.
Childcare providers in Bexar County operate at 70% of their maximum capacity.
Families often rely on informal care or exit the workforce entirely.
Lack of affordable and accessible childcare options creates childcare deserts, making it challenging for businesses to retain employees, particularly in low-wage sectors. This results in increased turnover, absenteeism, and training costs.

Philanthropic organizations may contribute by funding programs that expand childcare access and support early childhood education. However, private contributions cannot replace the need for comprehensive public solutions.

While some federal initiatives have made improvements, like executive orders requiring companies receiving funds to support employee childcare, more progress is needed. The federal government must increase its investments and reform policies. This action will build a robust child care infrastructure that supports working families and, by extension, businesses.

Small Business Owners Affected by Childcare Issues

In a national poll of small business owners by Small Business Majority, most say the lack of affordable, quality childcare is one of the biggest challenges for businesses. Their own childcare struggles have sometimes led them to step away from work, miss business opportunities, hire extra help, and even close their businesses.

Childcare issues also impact employees and overall business operations. When workers face childcare challenges, businesses deal with lower productivity, shorter hours, lost income, and the need to hire temporary staff.

Furthermore, employees often have to adjust their schedules because of childcare. This causes disruptions in business. Business owners say these issues lead to missed work and high turnover. Many employers feel these problems make it hard for both them and their workers to do their jobs well.

How Can Better Childcare Help Texas Businesses?

The economic impact of inadequate child care costs the state an estimated $9–11 billion annually in lost productivity and revenue.

The Employers for Childcare Taskforce, launched by the Texas Restaurant Association, Texas Association of Business, Texas 2036, and Early Matters Texas, has proposed policy solutions to create a more robust and accessible childcare system in Texas. These policy recommendations aim to support both the workforce and the broader economy. The goal is to ease some of the childcare challenges for businesses. Policy recommendations include:

Implement Franchise Tax Credits: Introduce tax incentives for businesses that provide childcare benefits to employees.
Expand Competitive Grants: Allocate funds for competitive grants aimed at helping existing child care providers expand their services, particularly in underserved areas.
Streamline Regulatory Oversight: Enhance collaboration between the Texas Workforce Commission and the Health and Human Services Commission to simplify childcare regulations and lessen administrative burdens and costs for providers.
Prioritize Subsidies for Childcare Workers: Offer subsidies to childcare workers to alleviate staffing shortages and improve retention.
Support Non-Traditional Hour Care: Develop childcare solutions that include non-standard work hours to benefit industries like hospitality, healthcare, and retail.
Address Childcare Deserts: Identify and invest in areas lacking sufficient childcare services, ensuring equitable access to parents in all regions of the state.

Childcare Initiatives for Businesses

Businesses can play a pivotal role in addressing the childcare crisis by implementing several strategic initiatives. The U.S. Chamber of Commerce Foundation’s Center for Education and Workforce recognizes the role of high-quality childcare in education and the workforce. For American businesses, advancing access to childcare is an investment in the future as we build the next generation’s workforce. A U.S. Chamber of Commerce Foundation report explores specific ways businesses can help advocate for early childhood learning.

Join Forces: Join or build an early childhood business coalition to educate and engage the public.
Set the Policy Agenda: Serve as a public policy advocate for young children. Include childcare in your local business organization’s legislative agenda.
Make the Business Case: Promote early learning policies as part of the economic development agenda. Spread the word about the economic benefits of high-quality childcare.
Speak Out for Children: Share knowledge through speaking engagements, op-eds, and blogs. Launch a media campaign to focus public attention on the role childcare plays in a stronger regional economy. Highlight the impact on children, families, and businesses.
Contribute Through Philanthropy: Invest in organizations and providers that support early education programs for low-income families. Donate funds to childcare initiatives like scholarship programs, or donate books and supplies to under-resourced local providers.
Lead by Example: Adopt policies that support employees with young children. Consider an on-site childcare center or implement a childcare benefits program.
Initiate Local Innovation: Form a team of local businesses, community, and childcare leaders to create partnerships and develop innovative strategies for improving access to childcare.
Lay the Groundwork for Systemic Change: Evaluate the current quality rating system to identify strengths and lay the groundwork for developing longer-term strategies to achieve sustainability of high-quality childcare.

High-Quality Childcare is an Investment, Not an Expense

Moms First, a group that advocates for working mothers, stresses that childcare is an economic imperative.

Boston Consulting Group and Moms First partnered to publish a study analyzing the economic impact of child care benefits at five companies. These companies represented a range of industries, sizes, benefit offerings, and job types, including deskless jobs. They found that all companies experienced positive financial return, and up to 425% ROI. The study showed that retaining as few as 1% of employees can cover the cost of the program.

This report proves the correlation between child care benefits and a thriving workforce. It highlights how much companies can benefit from investing in working parents.

Business Success in Supporting Working Parents

Huckabee, an architecture and engineering firm based in Texas, implemented a flexible working hours policy to support its employees, particularly working parents. The policy includes closing offices at noon every Friday, allowing employees an extended weekend, and starting the workday at 9 a.m. to accommodate morning family responsibilities. Employees are expected to complete a 40-hour workweek while having the flexibility to adjust their schedules as needed, including attending personal appointments.

This approach has positively impacted Huckabee’s corporate culture, leading to increased employee retention and satisfaction, especially among working parents. The flexibility offered is considered a competitive advantage in attracting and retaining talent. CEO Chris Huckabee notes that while the company initially adopted these practices to support employees and their families, they have also resulted in a more loyal, productive, and satisfied workforce.

Huckabee is a designated Best Place For Working Parents through its commitment to employee and family work-life balance.

Best Place For Working Parents

Best Place for Working Parents is a catalyst ensuring businesses, families, and communities thrive through family-friendly policies designed to meet workforce needs. Businesses compete to attract and retain top talent to enable their success.

Best Place for Working Parents states, “Through in-person roundtables with hundreds of diverse business leaders and in-depth national research surveying employees on the ROI of key family-friendly policies, we’ve learned that businesses big and small are strategically positioned to be a powerful change agent to ensure the future success of their companies, working families, and local communities.”

Small and micro businesses are increasingly leading the way in offering family-friendly workplace policies, according to the latest Best Place for Working Parents National Trends Report.

Nearly 60% of small businesses now offer backup childcare, recognizing its role in reducing employee absences and enhancing productivity. Parental leave has become a standout policy, especially in industries like finance, healthcare, and technology, giving small businesses a competitive edge in attracting talent. Companies offering maternity leave are significantly more likely to have high-performing teams. 96% of designated family-friendly businesses offer flexible schedules, and 93% provide remote work options. These policies contribute to higher employee motivation, better health outcomes, and increased workplace satisfaction.

San Antonio’s Best Place for Working Parents

Early Matters San Antonio and the Greater San Antonio Chamber of Commerce have joined forces to spotlight local businesses that support working families through the Best Place for Working Parents initiative. Employers can complete a self-assessment to qualify for the Best Place for Working Parents designation, earning a digital badge that showcases their commitment to family-friendly practices.

Take the Free assessment here: https://earlymatterssa.org/resources/best-place-for-working-parents/