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The Business Case For Child Care

By Jenny Callison, posted May 5, 2017
Denise Ward, co-director of Alcami’s Learning Center, is shown at the company’s on-site child care facility. (Photo by Chris Brehmer)
Denise Ward sees the child care center she helps operate as providing an environment that, she said, “builds kids up,” giving them a sense of belonging and security and a place where they are “excited about learning.”

Ward, co-director of Alcami’s Learning Center, which serves children from 6 weeks to 5 years of age, also sees the center as an effective tool for the pharmaceutical company as it seeks to recruit and retain employees.

“I see it as an excellent recruiting tool,” she said. “We get calls from prospective employees. One mom said [the center] was a factor in her deciding to come to work for Alcami.”

Alcami, formerly AAI Pharma, with facilities in on Scientific Park Drive, established the Learning Center 28 years ago for its employees’ children. The program, rated five stars by the state, has expanded over the years and is now licensed for 158 children.

Although the Learning Center began as a perk for AAI Pharma employees only, it now accepts children from the community at large. Currently, about 30 percent of enrollees are children of Alcami employees, who get first priority for available slots and a slight discount on the rate, according to Ward.

Alcami is rare among Wilmington-area companies in having its own child care program.

The availability of on-site child care was attractive to Catherine Hanley, Alcami’s senior director of marketing and corporate communications, when she weighed an offer from the company in 2015. As she and her family thought about moving to Wilmington from Maryland, finding good child care was “one of the most challenging things.”

“I have two kids. At that time, I had an 11-month-old. The Learning Center is certainly a huge benefit to being an employee here,” Hanley added. “Mothers who are still nursing can nurse their baby at lunch.”

There is definitely a business case to be made to companies about providing child care to their workforce, said Jane Morrow, executive director of New Hanover County’s Smart Start program. As part of its overall responsibilities, Smart Start oversees all licensed child care facilities in the county, working with them to ensure the quality of their programs.

About 40 percent of Smart Start’s budget goes to providing child care subsidies for what she terms families at risk.

“Your employees need high-quality child care,” she said. “Child care worries affect productivity and absenteeism, which are critical to [a business’s] bottom line.”

Research supports Morrow’s statement, and reflects Alcami’s experience. A report by the state of Oregon’s Bureau of Labor and Industries found that, “on a national level, the cost of absenteeism of working parents costs employers millions of dollars a year in lost productivity,” and suggests that child care facilities at the workplace actually pay dividends in terms of recovered time, better employee morale and improved work-life balance.

The report quoted Adam Sorensen, global work/life manager at Intel, as saying, “At Intel, we believe that employer-sponsored child care is a win-win-win,” meaning there are benefits to the company, the employee and the child. The report suggested that small employers, who do not have the workforce or the resources to invest in on-site child care, might “collaborate with other area small businesses to provide on- or near-site child care, and share the cost.”

While many businesses may be initially reluctant about costs, a 2005 study, “How Companies Can Benefit from On-Site Child Care,” details how employers that offer on-site child care saw returns and savings between 50 and 200 percent of the costs to operate the child care.

Then there’s the big, long-term case to be made for businesses to invest in child care, Morrow said.

She pointed to a recent survey of business owners, 60 percent of whom reported that the skills gap between available positions and applicants is a problem. Morrow believes that high-quality, early childhood education can address a child’s ability to adapt with new skills later in life.

“Ninety percent of the brain develops in the first five years of life,” she said, explaining that stimulating brain development in those early years is essential to developing what she calls “executive function” in a person’s thinking. Included in executive function are: the ability to adapt to changing circumstances, the ability to learn new things and the ability to control impulses and self-regulate.

“Children develop these things in relationships,” Morrow said. “They need another person to guide them, to model behavior. A child who is not picked up and comforted does not learn you can adjust to adversity. That child can grow up to be an employee who does not know how to get along with a team.”

Morrow’s comments, in an interview at Smart Start’s annual fundraising breakfast March 28, followed a keynote talk by nCino CEO Pierre Naudé, who spoke about the kind of employee his company strives to recruit.

The success of innovations at the 5-year-old banking software company, Naudé said, rests squarely on the shoulders of the company’s nimble- thinking, mostly young workforce. In fact, Naudé added, when he felt puzzled by just how to tackle his mission of taking Live Oak Bank’s proprietary software and expand its application to a much larger universe of financial institutions, he decided to “turn [the challenge] over to the kids.”

“We have to empower our employees, especially young, innovative thinkers,” he said.

Some of those “kids” have been hired locally: Naudé reported that one-third of his employees are University of North Carolina Wilmington graduates, and one-half of nCino’s workforce is from this region.

But the company has had difficulty finding, even among what Naudé calls the area’s “massive talent pool,” enough people with the skills and adaptive abilities to staff his technology company.

What Naudé was talking about, Morrow said, is finding employees who display executive functions.

Workers who did not have the opportunity to develop those functions by feeling secure and confident as young children, and then venturing out to try new things, can develop them later in life, but it is much more difficult, she said.

“If we have a skills gap, we can’t wait until they are not reading at a third-grade level or not graduating from a community college,” she said. “We must understand that early childhood learning is essential and enables children to adapt to technology.”
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