Did you know that families spend an average of 24% of their household income on child care – and more than one in three tap into their savings to cover caregiving costs? It’s no wonder 9 in 10 working parents report making at least one major change to their work, life, or finances to afford child care in 2023.
Overall, family caregiving responsibilities affect more than an employee’s budget and financial well-being. Researchers estimate that the lack of affordable child care costs employers and the U.S. economy $122 billion annually in lost earnings, reduced productivity, and hiring expenses, which result in reduced state and federal tax revenues.
The cost of care isn’t the only challenge facing employees. Access to affordable child care is a growing issue. The end of pandemic-era emergency funding under the Child Care Stabilization program created what’s known as the “child care cliff.” The decreased funding put many child care providers at risk of reducing enrollment or closing altogether, exacerbating access issues. 51% of American families live in “child care deserts,” which are areas with three times more children under age 5 than licensed child care slots.
Delivering family care benefits that make a difference
According to our 4th annual Future of Benefits Report, employers are exploring options to enhance their company’s family care benefits. 56% of employers say they are prioritizing child care benefits in 2024, a 10% increase over 2023, and 50% are prioritizing senior care benefits, up 7% over 2023.
So, how can you design family care benefits that provide the financial relief employees need and produce tangible business results? Consider these five strategies.
1. Ask questions. There’s no one-size-fits-all solution for care benefits. With four generations in the workforce, caregiving needs vary. Conduct a survey to understand the support your employees need most. You can also use the survey to gauge interest in different family care benefits.
2. Offer resources and tools. Convenient access to vetted caregiving resources enables employees to find the support they need when they need it. Provide resources beyond child care by offering support for senior, pet, home, and self-care.
3. Reduce financial stress. We asked employees which family care benefit they would want if they could have only one. Their top choices were dependent care FSAs and cash subsidies for care.
4. Create a community of support. Employee resource groups (ERGs) focused on caregiving provide a platform for employees to share experiences, advice, and resources. Fostering a workplace culture that supports caregivers of all types can help employees navigate challenges, get peer-to-peer advice, and discover solutions to address their needs. Based on your workforce, consider ERGs for new moms, working parents, senior caregivers and pet parents.
5. Be an advocate. Employers have a powerful voice in the caregiving conversation. Look for opportunities to raise awareness within your community and industry, and advocate for policy changes to help make care more accessible and affordable.
For more insights on how to ease the financial burden of caregiving for your employees, explore our Future of Benefits Report.
