Child Care has three distinct roles in Colorado’s economy. First, the Child Care sector is the source of early care and education for its 335,000 children under age 5, preparing them for future success in school and work. Second, child care is an essential workforce support for parents and their employers. Third, nearly 5,000 licensed child care businesses generate millions in annual revenues, create thousands of jobs and support higher output multipliers for other economic sectors.
Why Employers Are Interested In Early Care and Education
- Access and affordability for early care and education affect an employee's ability to work. When employees are worrying about child care, productivity is impacted - employees miss work to stay home with sick children, or decide to quit work because of child care problems.
- Financial implication for your business are real. "Bottom lines" suffer as productivity declines and employee turnover costs compound.
- Competition for talented employees is "tight". Colorado's Department of Labor and Employment reports the July 2019 unemployment rate at 2.9%, continuing to trend downward. In response, employers are devising creative ways to invest in their employees by building an organization with policies and benefits attractive to employees and those being recruited. With more than two-thirds of young children in Colorado living in households where all adults are in the workforce, attention to child care has risen to a new level.
- Federal and state tax deductions and credits make business investment in child care more affordable while the costs for families hit new heights and approach the level of college tuition. To support working parents, federal Dependent Care Flexible Spending Arrangements are offered by nearly 9 out of 10 large companies. IRS Publication 15-B, Employer's Tax Guide to Fringe Benefits, provides information for Dependent Care Assistance Page 9 through an FSA. Colorado's Child Care Contribution Tax Credit is a 50% state income tax credit for contributions to child care facilities as community investment.