Employers Are Cutting Childcare—Here’s What It’s Really Costing Them

By Sarah Glover, Engagement Director, Executives Partnering to Invest in Children (EPIC)

Just as childcare challenges remain one of the biggest barriers to workforce stability, more employers are stepping back from the supports that help solve them. 

Major employers like Google and General Mills have recently closed on-site childcare centers, citing cost pressures and changing workplace patterns. Deloitte and Zoom have both reduced parental leave benefits, part of a broader wave of companies reevaluating everything from paid time off to family supports in the face of cost pressures. Even organizations once known for generous policies, like Netflix, have pulled back from earlier commitments to parental leave.  

These decisions have been driven by shrinking budgets and shifting priorities. And benefits that aren’t clearly tied to business outcomes often become the first to be reconsidered. But when it comes to childcare and family supports, what looks like a cost-saving move on paper often tells a very different story over time. Companies experience higher employee turnover, increased absenteeism, stalled productivity, and the slow erosion of workforce stability. The cost savings don’t disappear; they just relocate. I’ve been thinking about this a lot lately, both in my role as an Engagement Director at Executives Partnering to Invest in Children (EPIC) and as a working mother who has navigated the daily reality of childcare decisions. And it raises a question I don’t think we’re asking often enough:

What if organizations had a clearer way to understand the return on childcare investments before making the decision to cut them? 

The Overlooked Link Between Childcare and Performance

Business leaders don’t need convincing that talent matters. Retention, productivity, and workforce stability are top priorities across industries. What’s often less visible is how directly childcare affects each of those. When care falls through, employees miss work. They log on late. They step away unexpectedly. Over time, that instability compounds into burnout, disengagement, and turnover.

A recent Moms First report underscores what many employers are already experiencing: The lack of reliable childcare is not just a family challenge, it’s an economic one. It affects workforce participation, earnings, and business performance at scale. So while it may feel easier to categorize childcare as a “nice to have” during tighter financial moments, the underlying issue doesn’t go away when the investment does.  

The Real Problem: Incomplete ROI Data 

What stands out in many of these decisions isn’t a lack of commitment. It’s a lack of complete information when it comes to ROI. Childcare supports are often evaluated as standalone expenses driven by questions such as: What does this program cost us this year? Can we reduce or eliminate that cost?  

If businesses were to, instead, view the issues through the lens of return on investment they could ask questions such as: 

• What is the cost of turnover among working parents?  

• How does absenteeism change when employees lose access to reliable care?  

• What does it cost to recruit and train replacements?  

• How are productivity and engagement affected?  

In most organizations, finance leaders wouldn’t make a significant operational decision without understanding both sides of that equation. But when it comes to childcare, many are forced to evaluate with incomplete data. So the question becomes: Do business leaders have the information they need to make these decisions well? 

The Economic Impact of Childcare Gaps 

Research consistently shows that childcare gaps carry a measurable economic cost. ReadyNation estimates the U.S. economy loses $122 billion each year due to lost earnings and productivity. State-level analyses from the U.S. Chamber of Commerce Foundation point to billions more in local economic losses. Federal Reserve and Treasury reports go further, identifying childcare as a constraint on workforce participation and overall economic growth. In other words, when childcare breaks down, it doesn’t just affect families— it affects business performance at every level.

At the organizational level, there’s also meaningful data that can be captured: 

• Retention rates of employees with young children  

• Promotion and advancement of working parents  

• Absenteeism and schedule disruptions  

• Recruiting outcomes in competitive markets  

The next step is making that data actionable. Employers can use the information to identify where childcare challenges are creating the greatest strain and target solutions accordingly. For example, if retention among parents is lagging, that points to a need for more reliable or accessible care options. If absenteeism is high, flexibility or backup care may be the priority.

Over time, tracking these metrics alongside any childcare investment allows leaders to see what’s working and adjust as needed. This turns childcare from a generalized benefit into a focused and informed workforce strategy, one that is continuously refined based on actual outcomes.   

And it’s important to note that the impact doesn’t stop with parents. When teams are understaffed or constantly adjusting for absences, it affects everyone. Non-parenting employees take on additional work. Managers spend more time navigating coverage issues. Productivity and morale shift across the board. Childcare challenges ripple through entire organizations, which means the benefits of solving them do, too. 

Moving From Perk to Strategic Investment 

This is where the conversation has the chance to evolve. Not every employer will invest in childcare in the same way. And not every solution will look identical across industries or workforce types. But every employer can approach the decision more strategically.

That starts with reframing childcare supports as investments tied to business outcomes, not just employee perks. It also requires better tools to measure what is actually happening inside organizations. 

 At Executives Partnering to Invest in Children (EPIC), we partner with employers to do exactly this—helping organizations move beyond assumptions and develop a clearer understanding of their impact by: 

• Identifying the specific workforce challenges connected to childcare  

• Supporting the collection and analysis of internal data on retention, absenteeism, and advancement 

• Evaluating which solutions align with their workforce needs  

• Measuring outcomes over time to understand what’s working  

What It Looks Like in Practice 

At EPIC, we’ve partnered with more than 65 employers to design childcare solutions that directly support their workforce. For example, at Guild, the Beehive provides reliable, high-quality care for up to 85 children just steps from the office spaces, helping reduce stress for parents and improving focus on the job.  

At Steamboat Resorts, onsite care for both year-round and seasonal employees has led to measurable results since opening in 2022: 90% of parent employees say they plan to stay, workers report fewer absences, and 70% say childcare benefits are a key reason they remain employed. In both cases, these investments have strengthened retention, improved attendance, and reinforced a people-first approach to workforce strategy. 

A Smarter Way Forward 

When employers take a more intentional, data-driven approach, the results are not only positive for working parents; they strengthen the organization as a whole. Retention improves. Employees stay engaged. Teams operate with more consistency. The investment starts to look less like a cost center and more like a driver of performance and overall impact. 

If childcare supports are evaluated without a clear understanding of their return, we risk cutting investments that are quietly holding up key parts of our workforce. 

If we want a more stable, productive workforce, we need to start evaluating childcare with the same discipline we apply to any other business investment. That means looking beyond short-term costs and asking what drives long-term performance. The employers who get this right won’t just support working parents; they’ll build stronger, more resilient organizations in the process.