Child Care and the CHIPS Act: Minimum or More?

Black female engineer

What do semiconductor manufacturing and child care have in common?

Turns out, the economy can’t function without either of them.

So it is that the White House recently amended its CHIPS Act – the program dedicated to ramping up U.S. chip production – adding a child care provision to ensure people producing the technology can take care of their children. Under the plan, applicants requesting direct funding over $150 million must submit a plan to provide child care to their workers. Those requesting less than $150 million are very strongly encouraged to do so.

It’s a promising development. But for HR, the provision also creates a problem – how do employers catch up? We’ve heard from many employers who are trying to figure out what a workable plan looks like – one that at once addresses the real issue of supply and quality, that meets the commerce department’s standard for compliance – and that can solve both for today and long term.

The starting point is to understand what the provision is and isn’t.

What are three things you need to know?

You Can't Always Solve Child Care With Vouchers

Vouchers are seemingly a quick fix for companies looking for a low-cost way to expediently qualify for CHIPS funding. But they’ll only get you so far. That’s because leaving employees to find care on their own is a false choice. It can’t control for quality – a big issue since only a small portion of the nation’s child care centers (11%) are accredited. It also fails to address the need for flexibility – and parents who need both every-day and occasional care. 

What’s more, vouchers don’t address supply at all. “If it’s just vouchers…you’re not necessarily increasing the number of childcare spots in a given community. You’re not necessarily increasing families’ options,” Lauren Ray, a Clinical Associate Professor of Early Childhood Education at Indiana University, told WBAA radio. Indeed, the Center for American Progress says more than half the country is considered a child care desert, writes Child Care Aware – many in manufacturing communities. With vouchers, then, “You’re taking care of that cost issue, which I’m sure is a relief,” says Ray, “but you’re not increasing options and you’re not necessarily guaranteeing quality.”

And there’s another important wrinkle: the CHIPS Act standards may allow for low-level answers, but where families are concerned, employees demand more than the minimum – and the lowest common denominator might get rejected by the commerce department’s guidelines.

One Size Does Not Fit All

Every employer is more than just a unique mix of audiences; they’re also an amalgam of locations, operating hours singular to their industry and employees, and varying degrees of child care availability. So a workable answer has to be a tailored, personalized, and flexible solution that’s nimble enough to reach multiple populations, with quality that’s consistent enough across all services to engender happy, productive, engaged people. Ideally, one provider with multiple touch points can cover all your audiences and solve for preferences and challenges within each geographic region.

It’s Not Just About Child Care

There’s more to the CHIPS Act than child care. The call for comprehensive benefits will have to address concerns such as senior care – a growing issue impacting employees across industries. And with skills an additional concern, it’s no surprise that “strings” detailed by the New York Times include education. “Applicants are also required to detail their engagement with labor unions, schools and workforce education programs, with preference given to projects that benefit communities and workers,” wrote the New York Times. “Other provisions will encourage companies, universities and other parties to offer more training for workers, both in advanced sciences and in skills like welding.“

Understanding Your Audience

So where does that take you? To be truly be effective, all responses must meet the audience – in this case, a highly educated and demanding workforce with technical skills. These employees value education for their children – and themselves.

The starting point, then, is to identify and address the diverse audiences your program will need to serve.

Infants and preschool: Parents of the youngest children are the most severely impacted, with costs in many states, according to the Economic Policy Institute, topping tuition at public colleges.

School-age care: Child care problems do not end at grade school. But a kindergartener on a day off from school is no better able to stay home alone than a toddler. And the average school calendar leaves a considerable gap between the 180 days children are in class.

Education for older kids: Academic worries for a child’s future are themselves an obstacle. Support that includes tutoring and test prep both addresses a real need and provides equitable support for parents beyond the care-intensive early years. 

Employees caring for seniors: Care for adult relatives is a recognized stressor – responsibilities that long before the pandemic were costing employers billions per year. Response programs both provide equitable support, and honor the commerce department’s call for “comprehensive benefits” that include elder care support.

Adult students: Besides providing caregiving support, the CHIPS Act touches on workforce development. “Applicants,” reads the government’s guide, “must secure commitments from strategic partners, including partnerships with regional educational and training entities and institutions of higher education to provide workforce training."

Assembling Your Plan

Leverage Managed Networks to Ensure Quality and Delivery

Child care isn’t just one thing. Parents with minimum support have to self-source care. Others need white-glove treatment with a concierge who can save time by assessing all options and making recommendations.

There’s also the additional element of unscheduled back-up care for those who have regular arrangements fall through, and for school-age care for older children off from school.

A fully effective care program has to account for all of it, with instant booking that gets people care when and where they need it, and with a managed network of quality services they either own or can fully stand behind, and that parents can trust.

Bright Horizons’ proprietary network of high-quality education and care solutions means your people can access solutions that fit their needs, without worrying about quality or consistency. Find out why many world-class brands choose Bright Horizons for their employee benefits.

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Achieve Ultimate Flexibility With On-Site Centers

Flexibility is key and opening your own center gives you ultimate flexibility because of the great examples already mentioned here.

By far, the most comprehensive answer to the CHIPS child care requirement is an employer-sponsored center. As the Washington Post put it, “Manufacturers may build on-site child-care centers for the children of employees, using CHIPS Act funding, which will ease labor shortages and allow parents of young children to enter the labor force.”

Indeed, such arrangements can solve for all elements – supply, cost, and quality. Built to reflect an individual company’s culture – in programming and architecture – they can singularly address the unique hours and needs of your employee population and industry, and can fully address the exceptional challenges of an off-the-beaten-trail location. Just as critically, an employer’s own center allows for tailoring to multiple pain points and populations: tutoring and camps for those with school-age children; flexible hours for those working full- and part-time schedules; and back-up care for those with emergency and occasional needs. 

But to ensure a center that is once financially viable and high quality requires a partner knowledgeable in all elements, including construction, licensing, and programming. An additional component: child care often requires short-term and long-term solutions. The best providers can often fill the need quickly with a temporary modular facility. Plus, the same flexible networks serving important needs such as emergency care can also provide reimbursement programs and trustworthy self-select networks while a center is being built.

Senior Care

Addressing the elder care need doesn’t have to be a standalone undertaking. Many employers use flexible care programs, that provide emergency care for children, to address on-demand care for adult relatives, whether these family members live in the same town as employees, or across the country.  

Workforce Development

Addressing education not only complies with the mandate, but delivers on retention and recruitment, filling in-demand roles for the future.

But, like child care, education is not one thing. A program that checks all boxes needs to tailor to your specific skills; scaled to your company’s size; and it needs to be affordable to remove financial barriers to achievement. To create a pipeline, it also needs to be able to nurture development at all levels of your organization, from entry-level to more advanced.

What It All Means

So where does that leave you? The best (and quickest) approach is a program that can give you all of it – a one-stop shop that allows you to ably deliver across all audiences. Flexibility is a must since the care rules of the CHIPS Act are firm. But the payoffs will be worth more than just compliance. Parents are a big part of the workforce. The workforce can’t function without them, and parents can’t function without child care. So in an era of extreme shortages, “child care,” wrote the New York Times, “will draw more people into the work force, when many businesses are struggling.”

Want to learn more? Bright Horizons partners with more than 1,400 leading organizations including many semiconductor manufacturers to provide top quality education and care solutions that help both employees and employers succeed. We are the only care provider with a managed care network, offering dynamic solutions and custom-designed programs that are scaled for size, tailored for values and culture, and that meet your people and financial objectives. These include: Child care, back-up care, and workforce education. Get in touch. Our team of experts can help you get started.

Black female engineer