The State of Childcare Reimbursement in the U.S.

The State of Childcare Reimbursement in the U.S.

The State of Childcare Reimbursement in the U.S.

The Bureau of Labor reports that in 2015 there are more than 30 million working mothers and fathers with children in the US. In 2014, 13% of state and local government industries had access to workplace-funded childcare. Only 10% of private industries had access to such funding. 

Following the State of the Union Address, President Obama proposed a childcare reimbursement and tax credit for working parents.  The President proposed a $3,000 tax credit per child for childcare. His proposal is meant to provide additional support for middle and lower-class working families.

What is the cost of childcare in the U.S.?

According to the U.S. Department of Health and Human Services, 10% of a family’s income should be used as the benchmark for affordable childcare. However, the average cost of full-time childcare can range anywhere from 7-15% of the state median income for married couples, and  more than 24% of the median income for single parents, this according to ChildCare Aware’s Parents and the High Cost of Child Care: 2015 Report.  

What are organizations offering?

  • Some organizations may offer flexible spending accounts. The employee would put money into a specific account each pay period, pre-tax. This then can be used to put toward childcare expenses. The IRS allows a maximum of $5,000 for your annual contribution, but your employer may set a lower limit.
  • Onsite childcare. Larger companies, such as Google, have an onsite daycare available. This may alleviate stress on parents who don’t have to travel to another location for drop off and pick up.

Northeast Ohio, what are we doing?

Until something is set in place by thefederal government, or by individual states, what are organizations in Northeast Ohio doing to help working parents when it comes to their childcare needs?

According to the 2014 NorthCoast 99 Winners Report, 31% of companies in northeast Ohio provide some type of childcare service or subsidies.

For many 2014 NorthCoast 99 Winners, childcare services or subsidies are fairly common, as demonstrated below:

  • Education: 75%
  • Health and Human Services: 37%
  • Non-Profits: 43%
  • Professional Services: 16%
  • Manufacturing: 7%
  • Other For-Profits: 9%

One of those winners, Hyland, creator of OnBase, has offered an onsite daycare for its employees since opening the doors of its Child Enrichment Center (CEC) in 2002. 

“Hyland, creator of OnBase, truly embodies its core values, and when speaking about the CEC, the core value “Our Employees are our Family” is most important,” says Kathleen Vegh, Manager, Employee Engagement. “The CEC provides a way for employees to come to work and have their children right there with them on Hyland’s Westlake, Ohio campus.  Providing care for employees’ children has broadened our sense of community far beyond our employees by including their families.”

Vegh has two children of her own in the CEC, and praises the benefit Hyland provides.

“As a working parent, there is nothing better than knowing that your children are in the wonderful care of the Hyland CEC teachers. They have truly created a second home for my daughters; and the care, education and love that they show all children is incredible,” says Vegh.

Currently, Hyland provides care for 130 children and is staffed with 40 teachers. It will care for children ages 6 weeks until they are ready for kindergarten.

“There is such a sense of community when it comes to the CEC. The relationships that are built between the parents and teachers are truly  invaluable,” says Vegh.

The future is unclear about what will happen with President Obama’s proposal for childcare reimbursement. However, individually, companies are exploring their options for ways to help their employees ease the cost of childcare. Whether it’s offering a flexible spending account or onsite daycare, many organizations want to help their working parents when it comes to affordable childcare. 

View ERC’s Parental Leave Policies and Practices Survey Results

This report summarizes the results of ERC’s survey of organizations in Northeast Ohio on practices related to parental leave policies & practices.

View the Results