This boss vowed to help his workers with child care. It hasn’t been easy

MANITOWOC, Wis. — It was during the height of the pandemic that Sachin Shivaram realized the depth of his employees’ struggles with child care.

The CEO of the 115-year-old Wisconsin Aluminum Foundry was dealing with rising absenteeism as child care centers closed and workers’ other arrangements fell through.

Then one day, a pink car seat in the backseat of an employee’s car in the parking lot caught Shivaram’s attention. He learned the worker was a single dad, working the evening shift from 2 to 10 pm. His daughter was 4 years old at the time.

With child care centers closed during those hours, the worker told Shivaram how he cobbled together care, dropping off his daughter at a neighbor’s house one day, an aunt’s place another.

“He wasn’t saying it in a way that he was sad about it,” recalls Shivaram.

But the CEO was deeply unsettled.

“We weren’t doing right by her,” says Shivaram. “It just got us thinking that, man, we’ve got to do something.”

There’s growing recognition in the U.S. that child care is an essential good, something that should be far more accessible and affordable for working parents.

It’s an issue that’s garnered attention in this year’s Presidential election, especially among Democrats.

But progress toward that goal has been elusive.

Many child care providers are barely keeping their doors open, while working parents struggle to afford care. A recent Care.com survey of parents with kids 14 years or younger who pay for professional care found American families spend nearly a quarter of their household income on child care.

Trying to get other businesses on board

In Wisconsin, Shivaram has met with obstacle after obstacle as he’s tried to tackle the problem.

Wisconsin Aluminum Foundry, which produces things like satellite dishes, parts for military and medical equipment, auto components and even cookware, employs about 900 people, just under half of them in Manitowoc, on the shores of Lake Michigan.

To help parents with child care needs, Shivaram first tried to build a new child care center nearby. Working with a corporate child care provider, they identified a former adult rehab facility that could be converted.

Shivaram says the company spent $30,000 to $40,000 to generate architectural renderings and figure out the business plan, only to realize that the endeavor was financially hopeless. With all the capital and labor expenses, this child care center would have cost a whopping $45,000 per child per year. It was a nonstarter.

“The median income in our community is about $52,000,” says Shivaram.

Not to mention, to have enough kids to fill a new center, he would have had to get other businesses on board. No one seemed interested. Shivaram kept hearing the same thing from his fellow CEOs: Child care may be a problem for some, but it’s not for my company.

Since the pandemic, a growing number of employers have begun offering some kind of child care benefit. The federal government has made it a requirement for semiconductor manufacturers who receive federal CHIPS grants. The U.S. Chamber of Commerce has championed the cause.

But in Manitowoc, Shivaram couldn’t even interest other companies in joining a consortium to support existing child care facilities. So, he was left to go it alone.

A $400 child care stipend

He decided to give each employee $400 a month to put toward child care costs. He originally wanted to earmark the money for licensed child care facilities, but then discovered many of his workers could not find spots. So for now, he’s reimbursing any child care expense, even to pay grandma.

It has made a difference for employees like Greg Place, a design engineer.

When his daughter was born two-and-a-half years ago, he and his wife, a teacher, wondered whether one of them would have to stop working given the high cost of child care.

“Being faced with that challenge for the first time is a little overwhelming,” he says.

Adding to the family’s financial challenges was the fact that their daughter was born with a cleft lip and palate. Place says a lot of his paychecks have gone to pay medical bills. While he initially benefited from a state-led program that worked with employers to subsidize child care, that program has now ended. The $400 stipend from work still leaves his family with about $500 to pay on their own each month.

“You just adjust,” says Place, adding that the enrichment and relationships his daughter gets through the local YMCA’s child care center are well worth the cost. “She’s very adventurous. I can’t slow her down one bit.”

Keeping employees at work

Approximately 100 of the foundry’s employees currently use the child care benefit, including Emily Kasbaum, an HR business partner and mother of three young children. She says the extra cash has whittled her family’s child care costs down enough to keep her on the job.

“Mathematically, I guess, it makes sense for me to still work, and I can still contribute a fair amount, even after childcare expenses,” she says.

Kasbaum delights in letting new employees know about the benefit.

“They are shocked to hear that a company will actually do that for their employees,” she says.

While Shivaram is proud of what his company has done for individual workers, he grapples with the reality that they haven’t made an impact more broadly. He wishes the foundry was contributing in some way to raising wages for child care workers in his community, or raising the quality of care.

“I really took this issue on as something I cared about… and yet there’s nothing lasting from what we’re doing,” he says. “There’s nothing that is going to put us on a path to improving the situation, so this is where my dismay comes in.”