“In the Covid-19 Economy, You Can Have a Kid or a Job,” reads a recent headline in The New York Times. “You Can’t Have Both.”
As leadership teams consider how they’ll return to some version of “business as usual” when the pandemic abates, there’s one factor they may be overlooking: When daycares and schools close, working parents without effective support systems are forced to prioritize between their children and their career.
“The pandemic has made a bad situation worse,” says Simon Workman, director of early childhood policy at the Center for American Progress.
The supply of high-quality child care couldn’t keep up with demand before the pandemic, and it’s expensive, accounting for 20% to 30% of a family’s monthly income, he says. Providers that are already financially strapped are now earning even less, due to safety and health guidelines that can be costly to comply with. Some providers won’t endure the economic fallout from Covid-19.
Amid the myriad worries facing companies today, child care may seem minor. But it’s a huge stressor for employees, impacting their ability to work. Inadequate child care resources cost working parents and the companies that employ them tens of billions of dollars annually, according to a Care.com study, with parents losing $37 billion in wages and companies experiencing $13 billion in lost productivity. And the problem is larger than those numbers suggest: Care.com’s research only accounts for parents of children under the age of three.
Child care benefits could be an effective tool in a company’s arsenal when it comes to attracting and retaining talent. Roughly half of bank employees are 45 or younger, according to Bank Director’s 2020 Compensation Survey, meaning that many are focused on building families as well as their careers. Yet only 12% of banks offer child care benefits, according to our survey.
Sterling National Bank, a subsidiary of Sterling Bancorp, chose to subsidize backup child care for its employees following conversations between CEO Jack Kopnisky, Chief Human Resources Officer Javier Evans and Margaret Wortley, director of benefits, HR operations and compliance, exploring how Sterling could better compete for talent in New York City.
“Jack talked to Margaret and [me] and said, ‘I want us to offer contemporary, forward-looking benefits to keep us right there at the leading edge,’” Evans says. The $30 billion bank based in Montebello, New York, competes for customers and talent with the likes of JPMorgan Chase & Co. and Citigroup.
“[They’re] all here in our backyard,” Evans continues. “So, we’ve got to make sure that we stay at least contemporary, from a benefit offering, so we can be competitive from that point of view.”
One provider the bank chose was Helpr, a startup offering a range of services for employees, including backup care, online classes and tutoring for kids, as well as consulting and concierge services.
Sterling initially subsidized 16 hours of backup child care annually, intending to offer employees a chance to take a date night, for example. This grew to 80 hours due to the pandemic. Up to that limit, an employee pays no more than $6 per hour with the bank covering the rest.
For employees seeking long-term care, Sterling also subsidizes the cost to recruit and screen candidates. Employees pay a one-time $500 fee; a similar service would cost $2,500, says Wortley.
“We’re hearing back from companies that primary care is the biggest stressor for their employees right now,” says Sarah Bystrom, a business development executive at Helpr. “That’s causing this anxiety and stress around how to continue to balance family and work life.”
In addition to Helpr, Sterling works with Bright Horizons, another care provider.
In response to the pandemic, the bank increased hourly pay for front-line staff and awarded a $750 bonus to non-executive employees, according to Evans. They also received extra paid time off, which many used to care for children, and Sterling has worked with employees to create more flexible schedules. Virtual education goes beyond banking to cover topics like working at home with children.
Sterling also provided access to Headspace, an app focused on mindfulness and mental health. “We knew right at the beginning of the pandemic that this would take a mental toll on folks,” Evans says.
Working parents need support in these unique times; they’ll also need it after this crisis is in the rearview mirror. According to Workman, about 2 million families experience a job disruption — missed work or even quitting — due to child care challenges.
“That’s bad for the family, but it’s also bad for the employer,” he says. “As a society, as an economy, we all benefit when families have access to high-quality, early childhood education they can afford and access on a reliable schedule.”