UPS is expanding its emergency child care benefits for workers after a successful pilot program, the shipping company announced recently.
In partnership with Patch Caregiving, a child care solution provider that works with employers, the UPS Emergency Child Care Initiative was piloted from August 2022 to January 2023 during the evening shift at a UPS facility in Northern California. UPS established "goals of reducing work absences because of child care challenges and increasing retention," UPS said in an announcement.
UPS will now expand the emergency child care initiative to include additional shifts at the pilot site and select Pennsylvania facilities in the fourth quarter of 2023. Additional facilities across the U.S. will be added in 2024. The company said it has over 2,000 facilities and more than 500,000 employees worldwide.
The pilot program offered emergency day care services onsite at the Northern California facility, "where parents would have the lowest possible barrier to using the new service," UPS said. Eight in 10 eligible employees participated and took advantage of the service more than once, avoiding more than 120 unplanned absences. Employee turnover among the pilot group dropped significantly, from 31 percent to 4 percent.
The announcement comes as a number of employees experience child care challenges.
SHRM Online rounded up additional news on child care in the workplace.
Pandemic-Era Child Care Funding Has Expired. That’s Likely to Have a Big Impact on the Workplace
Finding child care has historically been an issue for many working parents, but problems might get even worse.
On Sept. 30, $24 billion in federal pandemic relief funding for child care—as part of the $1.9 trillion American Rescue Plan Act passed in March 2021—expired. That expiration may cause more than 70,000 child care providers—roughly one-third of those supported by the funding—to close in the coming months, according to estimates from The Century Foundation, a liberal think tank. Other providers may raise prices to stay in business.
The expiration has big implications for employees trying to balance work and child care simultaneously and for companies that count on workers to be present and productive on the job. The news, industry insiders said, indicates that employers and HR leaders will have to step up if they don't want to risk losing employees, particularly women, who bear the brunt of child care responsibilities.
Beefing up benefits to support working parents is one obvious solution, said Julie Stich, vice president of content at the International Foundation of Employee Benefit Plans (IFEBP).
"In light of the end of federal funding and the rise in child care centers closing, employers will need to consider what they can do to accommodate working parents of young children," she said.
Benefits offerings will come into play, including more onsite or backup child care options and dependent care flexible spending accounts (FSAs), which are tax-advantaged accounts that allow workers to fund and pay for child care. IFEBP data finds that the majority of employers (75 percent) offer dependent care FSAs.
Child Care a Desired Benefit for Employees
In general, employees highly value child care benefits from their employer—but onsite child care in particular was the least frequently offered family-friendly perk in an assessment of 1,700 companies, according to a report earlier this year by business network The Best Place for Working Parents, in Fort Worth, Texas, and Southern Methodist University's Center on Research and Evaluation.
"Sufficiently subsidized and high-quality onsite company child care tends to have the greatest perceived value to employees and one of the highest returns to the company," said Sadie Funk, national director of The Best Place for Working Parents.
Hormel Building Onsite Child Care Center
Food processing giant Hormel announced earlier this year that it is building a $5 million child care center at its headquarters in Austin, Minn. The facility is expected to open next year.
The firm noted that lack of child care facilities has long been a concern among some employees. Hormel was also concerned that it was a problem for potential hires.
The goal of opening the 13,000-square-foot child care center is to free up potential employees, many of whom are currently stuck at home due to lack of child care, Hormel said.
Hormel said it hopes the child care center can aid in recruiting and retaining working parents in today's tight labor market. "You don't have a workforce if you don't have child care that they're able to rely on," Angie Bissen, Hormel's manager of HR business partners, told Axios.
Expensive Child Care Is Keeping Parents Out of the Workforce
Child care problems are contributing to worker shortages in many industries, according to new research. An estimated 380,000 Americans in their prime working years—aged 25 to 54—who held jobs before the pandemic no longer do, according to estimates from Bank of America. A big reason for that, experts said, is a lack of affordable and quality child care.
The problem is more prevalent among lower-income employees who work in sectors such as retail and restaurants.
A lack of child care—alongside other factors such as concerns over COVID-19 and other illnesses and early retirements—has helped push the unemployment rate to a 53-year low at the start of the year, analysts said.
(The Wall Street Journal)