In 2022, UPS implemented a pilot program for emergency on-site childcare at a warehouse in California, after noticing that workers were regularly calling out sick due to unexpected gaps in childcare. The company found that the return on this investment was almost immediate: Retention increased from 69% to 96% among hourly workers, and UPS has since expanded the offering to other states.
Other companies like UPS that have invested in childcare benefits have seen returns that range from 90% to as high as 425%, according to a new report by Reshma Saujani’s nonprofit, Moms First, which was produced in collaboration with Boston Consulting Group. The report compiles data on nearly 1,000 workers and comprises case studies from five U.S.-based employers across different industries—including UPS—which reveal how childcare benefits have impacted their workers. One part-time worker at UPS, for example, was promoted to shift supervisor within a month because she was able to take advantage of the company’s childcare benefit.
“This report with BCG is proof that childcare benefits not only pay for themselves, but also make financial and strategic sense, creating an advantage for businesses that step up and make the investment in their employees,” Saujani said in a statement.
The report underscores what many employers already know to be true: Corporate benefits that help families cover childcare and fertility treatments are incredibly popular among workers and drive higher retention. A majority of parents—63%—have made career changes to foot the cost of childcare, while 58% have left jobs due to a lack of childcare. For companies, the employee turnover that is caused by inconsistent access to childcare can cost them $13 billion annually. According to the report, retaining just 1% of employees who are eligible for childcare benefits could cover the cost of the benefit. (A similar survey found that for every dollar companies spent on caregiving benefits, they saw a nearly-18 times return on their investment.)
As illustrated by the report, employers offer a variety of childcare benefits—some more generous than others—though all seem to have yielded a positive return on investment at the companies surveyed. At Etsy, employees are entitled to $4,000 in backup childcare credits each year, along with a $1,000 stipend, and about 60% of parents claim that the offerings had enabled them to stay in the workforce. (Etsy also has a very liberal parental leave policy, with 26 weeks of paid leave.)
Financial services company Sychrony provides 60 days of backup childcare each year, which has helped reduce unplanned absences by 45% among employees who are parents; and at Fast Retailing, a retail holding company, 86% of people surveyed said they were more likely to stay at their job due to a $1,000 monthly childcare stipend.
The report also features the Steamboat Ski Resort, which is located in an area known for being a childcare desert. The company not only added a childcare center nearby, but also offers employees a 20% discount and early registration. “This benefit is unmatched, and it shows that the employer is invested in your family,” a sales manager at Steamboat said when surveyed for the report. “That investment to me is critical.”
