Corporate childcare: the next big employee benefit

Surveys of working parents show huge demand for childcare benefits. Is it time for businesses to contribute more?


Working parent Isabel Mohan and her husband have spent about £90,000 on childcare for their two children over the past five years, she estimates. Now, for the first time, Mohan is in a role that offers a £5,000 childcare allowance.

Mohan puts the money towards a childminder who collects both her three-year-old and six-year-old from pre-school and school then looks after them for the rest of the working day. While the allowance is currently a one-off, it’s set to become an annual benefit, one that Mohan’s found valuable. 

Childcare is investing in employees’ time - it’s right up there with medical care in my eyes.

“I’ve been spending the last five years juggling childcare and work. It’s been a huge cost, and it’s really nice to work for a company where that’s prioritised, because it’s a lot of money,” she says. “It makes me feel more valued and positive about my job. That makes me want to stay.”

Mohan is head of content for Tiney, a startup that recruits, trains and onboards home-based childminders into its network. She pays her childminder in full, and Tiney reimburses her.

The company has seen a growing interest in such benefits on a wider scale. It’s about to launch its corporate offering and is already having discussions with large consumer tech companies about employee childcare packages. 

Putting childcare first

Childcare benefits are in greater demand than other employer offerings, such as gym memberships, wellbeing benefits, free company events and even enhanced parental leave pay, according to a survey of 5,000 UK and US professionals in September by recruitment platform Beamery. Despite the interest, just 11% of employers provide childcare as a benefit.

The same survey found that 53% of people are considering leaving their job in the next year, with 25% feeling their employer could have done more in the past 12 months to help with work-life balance.

The results resonate with Mohan, who’s become more discerning over how employers cater to working parents.

“As much as I would love to benefit from free drinks and social events, that isn’t always possible for a 40-year-old working parent. That money could be better spent on supporting people in different ways,” she says. “I’d feel more empowered now to ask in an interview, ‘what do you offer for working parents?’ If I wasn’t able to get the childcare benefit elsewhere, then I’d want an extra £5,000 in my pay.”

Filling the gap

Corporate childcare provision isn’t just about retention; it’s also a driver of diversity and equality. Expensive childcare is linked with negative impacts on women in the workforce after having children. According to data from women’s rights charity Pregnant Then Screwed, around 62% of mothers who return to work either work fewer hours, change jobs or stop working because of childcare costs. It’s calling for an independent government review of childcare affordability in the UK.

Founder and chief executive Joeli Brearley believes the corporate sector has a strong role to play to fill the gap.

“If employers want to employ the best people, then they need to consider what those employees need to be able to work to their full potential,” she says. “I would love to see FTSE 500 companies establish on-site childcare and then document the impact on staff recruitment, retention and wellbeing. I think this will be the next policy we start to see from companies who lead the way on diversity and inclusion.”

Brearley points to outdoor wear brand Patagonia, which provides on-site childcare for all employees at its US headquarters. At Patagonia, 100% of new mums return to the company, she notes, compared to an average of 79% across the US, while 50% of senior leaders are women.

For smaller companies and those whose staff work in a remote or hybrid way, on-site childcare might not be feasible. But employers could partner with childcare providers to offer other means of subsidised childcare, Brearley suggests.

That’s why well-known nursery chain Busy Bees has relaunched its corporate offering. While it has operated an on-site nursery at Jaguar Land Rover’s Solihull site for over 10 years, it’s now extending its programme, allowing companies to buy places at Busy Bees nurseries or provide credits to allow employees to make bookings themselves. 

“It’s fostering workplace equality and enabling businesses to show they care about any type of parent returning to work. Childcare is investing in employees’ time - it’s right up there with medical care in my eyes,” says Busy Bees’ business sales director Antony Morrison.

Helping smaller companies

Childcare startup Bubble specialises in booking babysitters and nannies. It’s awarding £50,000 in childcare benefits to eligible startups, citing stats that show one in five women leave the tech industry due to poor work-life balance.

Bubble has also recently launched its corporate offering, with the investment bank Numis an early adopter. Numis has taken out 50 staff subscriptions, each worth about half a day a month of ad hoc in-home childcare. 

Head of HR at Numis, Mica Ross, says she’s prepared to increase the number of licences and the level of subsidy if the demand is there. But what’s most appealing is that a solution now exists to allow a smaller company to compete in the benefits stakes with larger financial institutions like Goldman Sachs, which provides on-site childcare in some offices.

“Five years ago, I don’t know if I could have been thinking about this kind of solution. Finding something that’s easy to manage for a corporate that isn’t a huge machine is an important aspect of this,” argues Ross. “It’s the many small things you do that add up to you being a responsible employer that looks out for your people.”

Government support

Ross and Brearly agree that it isn’t wholly a company’s role to provide full-time childcare. 

“The issue should rest at the door of government. Childcare and early years education should be available to all children, not just the children whose parents work for a forward-thinking company,” Brearley says. 

It’s an important gap to fill. When you consider the percentage of mothers reducing their presence in the workforce or leaving it altogether, companies like Patagonia are paving the way for women to reach their full career potential.