Why Every Employer Should Invest in Parents

Pedro Silva
3 min readSep 29, 2020

Employers are always under pressure to allocate limited resources, especially during economically volatile times.

When it comes to benefit programs, companies that provide more support to working parents can improve childcare affordability and workplace productivity while enhancing the overall efficiency of their programs.

Making childcare more affordable for every employee is the right thing to do. Employers also have strong business reasons to improve the benefits they offer.

Better Childcare Benefits Make Employees More Productive

The high childcare costs are hurting your company. Last year, employers lost an estimated $57 billion in earnings, productivity and revenue because employees lack affordable childcare options. The drag on employers due to the childcare affordability crisis is expected to grow this year as the economic loss from the COVID-19 pandemic has limited options. In fact, childcare benefits can enhance workforce productivity. Assistance focused on affordable primary childcare helps parents miss fewer workdays, have fewer schedule changes and lose fewer overtime hours.

Expensive childcare options particularly hurt the productivity of female employees. Women make up roughly half of the workforce and 40% of mothers working outside the home say they must take time off work and stay home when their children are sick, compared to 10% of working fathers, according to Kaiser Family Foundation. More than half (56%) of this group of women forgo their wages when they take time off to care for their sick children.

Parents struggle to find childcare that best fits their individual needs across all income levels. Nearly half of households earning more than $100,000 per year had difficulty finding quality childcare, according to a study by the Center for American Progress. Employers can address this problem by providing online tools that make searching for childcare providers easier.

Childcare Is More Valuable Than Other Benefits to Parents

A parent-friendly workplace means lower turnover costs and higher productivity because childcare is perceived to have a higher value than other benefits. The return on investment and the goodwill generated by a comprehensive child care benefit program can eclipse the costs.

Millennial workers, who make up one-third of the workforce, have more mothers as primary breadwinners and more fathers with caregiving responsibilities, so they value childcare more than previous generations.

As employers work to build a more diverse and inclusive workforce, tailored childcare benefit programs can provide working parents, especially women and minorities, more opportunities to stay and grow within an organization.

Childcare Benefits Can Be Maximized for Tax-Efficiency

Employers often overlook a powerful funding source that makes childcare benefit programs more affordable. By maximizing federal and state tax incentives, companies can provide better childcare benefit programs. Twenty-four states have a state childcare tax credit, which makes offering childcare benefits a better deal for employers, but too few take advantage of them.

Dollar-efficient childcare benefits can save employers up to 70% on program costs. This doesn’t happen automatically. Arvorie’s platform can help employers optimize their childcare benefit programs while giving them more financial resources to support working families.

Less than 40% of employees currently use a dependent care flexible spending account, according to the U.S. Bureau of Labor Statistics. While a dependent care FSA helps employees partially, existing untapped federal and state tax incentives for your company can boost the impact of your investment in childcare benefits significantly more.