Special Report: Family Ties: Home Is Where The Heart Is

At sunrise every morning in the Los Angeles suburb of Glendale, the Shanker family gets ready for work. Steven Shanker, 37, and his wife Avima, 35, wake their two sons, Elan, 5, and Dannel, 2, for a hurried breakfast of cereal and orange juice. After the meal Avima heads off by 7:30 to her job as an engineer at Librascope, a computer firm. Then, as other pinstriped parents up and down the San Fernando Valley march out to their cars with groggy children in tow, Steven, a vice president at Union Bank in nearby Monterey Park, drives the boys to their day-care center, where he will pick them up again at 6 p.m.

Millions of American working couples must scramble every day to arrange care for their children. But the Shankers have one big advantage over most parents: the day-care center is at Steven’s office. Union Bank provides $150,000 a year to subsidize the complex, which includes spacious play areas and five classrooms. While it would cost Shanker up to $700 a month to put his boys in other local day-care facilities of comparable quality, he pays the bank only $520 through convenient payroll deductions. Moreover, the arrangement allows him to avoid paying taxes on the portion of his salary that goes to child care. The best part, though, is that Shanker can walk downstairs at lunchtime to visit Elan and Dannel, and is nearby in case of emergency.

Union Bank is one of thousands of firms that have grasped a basic fact of business in the era of the two-career household: when companies hire employees, families and all of their homelife headaches are taken on as well. If little Suzy goes off to day care with a cold, Dad may fret about it at the office all day. If Mom suddenly has to work late, there may be no one to pick up Suzy and give her dinner. And if Grandma falls and breaks her hip, that budget report due tomorrow just doesn’t seem so important anymore.

Instead of blindly demanding endless sacrifices from their workers, companies are increasingly looking for ways to help ease the unavoidable conflicts between career and family. More than half of all U.S. firms provide some form of family benefits, ranging from paternity leave and flexible hours to assistance in finding the right nursing home for an elderly parent. The Merck pharmaceutical company helped start a day-care center near its Rahway, N.J., headquarters, and permits employees to start work as early as 7 a.m. or as late as 9:30 a.m. so that they can meet family obligations. Procter & Gamble offers workers unpaid child-care leave of up to one year, with a guarantee that they will not lose their job. American Express conducts workplace seminars on topics as diverse as pregnancy planning, family stress and elder care. Capital Cities/ABC contributes up to $3,000 when an employee adopts a child.

All these programs stem at least in part from genuine concern about employee welfare, but they are good for the bottom line as well. In a report on family benefits, the U.S. Chamber of Commerce asserts that responsiveness to workers’ needs on the home front “can yield higher employee morale, productivity, recruitment and retention potential, as well as stem excessive absenteeism.” From his experience, Union Bank’s Shanker agrees: “My commitment has increased and I feel a new level of goodwill toward the bank because my employers have shown concern about my family. There is a direct connection between the existence of the day-care center and my job performance.”

But corporate efforts to help families are only beginning to gain momentum, and many working parents still face enormous difficulties. For that reason, family issues are among the hottest topics of political debate in this election year. Congress is considering more than 100 child-care bills, including the so-called ABC (Act for Better Child Care) bill. Backed by Michael Dukakis but opposed by the Reagan Administration, the measure would establish a $2.5 billion program of child-care grants to the states and would set federal standards for day-care facilities. Vice President George Bush has proposed an alternative approach: a $1,000 tax credit to help families pay for , child care. Under this plan, families earning too little to qualify for the tax refund would get a check for up to $1,000 per preschool child from the Government.

Some of the proposals for greater federal involvement in family matters are aimed directly at business. The Family and Medical Leave bill would require businesses employing 50 or more people to allow workers up to 15 weeks a year of unpaid medical leave for a variety of family-related reasons, including pregnancy, stress and the care of ailing parents or children. The controversial bill, which would guarantee job security during such leaves, is strongly opposed by many business leaders as too costly, especially for smaller companies. Says Virginia Thomas, a spokeswoman for the U.S. Chamber of Commerce: “The bill supposes that every employer is like IBM or General Motors and can afford to hold open jobs for 15 weeks per year.”

Companies may be wary of heavy-handed Government intervention, but more and more of them recognize that corporate America must adapt to a rapidly changing workforce. Both husband and wife hold jobs in 57% of U.S. couples with children, up from 43% in 1978. In 1950 only 12% of mothers with children under six years old worked outside the home; more than 57% do so now. Over the past ten years, in fact, the fastest-growing segment of the U.S. labor force has been mothers of children younger than three years old. More than half of these women have jobs today, up from a third in 1976.

Until recently, companies did not have to be too concerned about the needs of these new employees. If a woman wanted to take time off to have a baby or reduce her hours to spend more time with a child, the employer could easily fill her slot with another worker. During the 1970s, the U.S. work force increased by an average of 3 million people a year. But in the next decade, as the baby bust — the smaller generation behind the huge baby boom — comes of age, the labor force will grow more slowly than at any other time since the 1930s, expanding by just 1.3 million new workers each year. Says Tom Blumer, director of human relations at Corning Glass: “We no longer have the luxury of an unlimited labor supply.”

Moreover, the majority of new workers in this smaller labor pool are women. The Hudson Institute, a nonprofit Manhattan research organization, estimates that 3 out of every 5 people entering the work force during the next twelve years will be women. Most will have children at some point during their careers.

As the child-care problem grows, so does the burden of caring for the elderly. Americans who are 75 or older are the fastest-growing segment of the population. Sociologists have dubbed today’s workers the “sandwich generation” — a put-upon group that has to attend to children on one side and parents on the other. Says Robert Beck, executive vice president for corporate human resources at Bank of America: “The focus may be on child care now, but elder care will become the critical issue of the future.”

The increase in family pressure on workers creates costly problems for business. Studies conducted by several large corporations, including IBM, Merck and Corning Glass, show that family responsibilities often contribute to reduced performance, higher turnover, greater absenteeism and worsening health among workers. Companies also lose out when experienced employees turn down a transfer or a promotion because they cannot reconcile work and family.

Measuring the costs of such conflicts is difficult, but some researchers have tried. Analysts examining employee turnover typically estimate that replacing a worker can cost the equivalent of a year’s salary or more in training expenses and lost productivity. Such outlays are rising rapidly, since women, who are more likely than men to have to leave their jobs, make up an increasingly large part of the work force and are holding more high- salaried managerial posts than ever before. Says Frank Skinner, president of the Southern Bell telephone company: “No employee who has to leave a sick child or an elderly parent at home without adequate care can be expected to be your most productive employee. It is clearly in our best corporate interest to find ways to help employees address these problems.”

Some companies are doing just that. One in 10 U.S. firms now provides some form of child-care assistance to employees. Many companies merely distribute lists of local community services, but at least 600 firms provide day-care facilities on the premises. In Dade County, Fla., the American Bankers Insurance Group operates a kindergarten and first-grade class, using teachers and classroom supplies provided by the local school district. Since the school opened, absenteeism and employee turnover are down sharply. To hold down costs, companies in some cities have joined forces on child-care programs. In Tysons Corner, Va., 22 firms raised $100,000 to start a day-care center for their employees last year.

$ Elder care lags behind child care on the corporate agenda, but increasing numbers of companies recognize that Grandpa can sometimes create more trouble than Junior. IBM learned in an employee survey last year that 30% of its workers help take care of elderly relatives. So starting last February, the computer company began operating the first nationwide elder-care referral service for its 237,000 employees and 33,000 retirees. In the first month alone, more than 4,000 employees called for help. Bobby Sloan, 55, an IBM equipment designer in San Jose, Calif., used the service to arrange medical care for his mother, a 78-year-old victim of Alzheimer’s disease who lives 2,000 miles away in Ponca, Okla. Says he: “I don’t believe I could have done it without them.” Transamerica, Arthur Andersen and Aetna Life & Casualty offer similar services.

In Cambridge, Mass., the Stride Rite company is building an “intergenerational center” near its headquarters to provide day care for up to 60 children and 30 elderly relatives of its employees. Stride Rite chairman Arnold Hiatt believes the center, scheduled to open in 1991, will have advantages over facilities that cater strictly to children or the elderly. Since the two groups will share some activities, both are expected to get more out of the experience.

Perhaps the most common of family benefits is flexible scheduling, or flextime, which permits employees to adjust their working hours to meet personal needs. In some 60% of U.S. workplaces, employees are allowed some leeway in when they work. Typically, a flextime employee comes to the office earlier or later than the standard time and then works a full eight-hour day. In Oak Brook, Ill., computer workers at the Official Airline Guides publishing firm can cluster their hours, and work from 7 a.m. to 7:30 p.m. three days a week. Other companies adjust hours on a case-by-case basis. At Stride Rite, comptroller Nancy Cirigliano varied her schedule last December when her father was hospitalized, coming in late some days and leaving early on others. Says she: “My boss said, ‘Don’t even ask.’ He understood.”

Traditionally, giving birth has been the common reason for taking a family leave. More than half of U.S. firms offer some form of maternity leave. But a growing number of companies are broadening the policy to give fathers parental leave or to let workers have time off to care for sick children or parents. Southern New England Telephone guarantees the employee’s job for up to six months of unpaid parental leave. Mike Liquori, 34, a customer-service representative, took a four-month leave starting last October to care for his infant son Luke after his wife’s maternity leave ended. Says Liquori: “It created a bond between Luke and me that maybe wouldn’t be the same if I hadn’t been there.”

In the years ahead, more and more employees are going to demand the opportunity to give their families at least as much attention as their careers. If they are not satisfied, they may just look for work elsewhere. Says Bank of America’s Beck: “Corporations are going to have to do more to get good skilled people and to keep them. To do that, we will have to start looking at the whole person, and work on strengthening our understanding of the employee-family relationship.”

Such an effort will yield long-term dividends. Companies that help parents will make it easier for them to raise healthy, happy children. That will go a long way toward ensuring the quality of the next generation of workers. Seen in that light, good family policies are a critical investment in America’s economic future.