On The Horizon January 2023

Jennifer Liston-Smith’s monthly review reflects on key themes, news and public policy updates in the world of combining work and family for organisations, parents and carers.

January’s Key Themes for employers of working parents and carers

  1. Employers are focused on attraction and retention

There is much discussion as to whether the UK is technically in a recession. Most forecasters do predict the economy will contract across 2023, despite surprise reports of growth in November 2022. This growth was boosted by World Cup related takings in pubs and bars and a ‘bumper’ Christmas season for the likes of Tesco, M&S, Lidl and others.

With the labour market still tight, employers continue to focus on retaining their talented employees and attracting skilled people. Mental and financial wellbeing continue to be a focus for investment, as do family benefits.

How will job vacancies be filled? With the Government and Opposition against the idea of bringing in more workers from overseas, the Department for Work and Pensions has been exploring new ways to bring back the half a million economically inactive working age adults to the workforce. This group is weighted towards the over 50s and despite some signs of a ‘great unretirement’ prompted by the cost of living crisis, there is still concern over a surprising number of older workers having fallen out of the workforce. There are mixed views on the value of possible incentive schemes to encourage their return, such as exempting over-50s returners from income tax for six months to a year or enabling people on sickness benefits to retain their value while beginning to earn again.

PwC predicts that 300,000 workers will return during 2023, purely based on the natural ebb and flow of the workforce and the observation that the UK and US are the only major economies still seeing more economic inactivity than pre-pandemic. People Management points out that employers wishing to attract this skilled and experienced group will need to show flexibility, wellbeing programmes and support for carers.

Research by Bright Horizons underlines the need to support carers. Our 2022 Work+Family Snapshot (client employee survey) showed that 81% who have adult or eldercare responsibilities had experienced care breakdowns in the preceding 12 months. After a positive experience of employer-sponsored back-up care, 87% of all employees said it enhanced their wellbeing and 88% said they were more likely to recommend their employer to others. Our 2022 Modern Families Index (with a random sample of UK working parents and carers) showed 74% of people caring for elderly relatives would be looking to change jobs in the following 12 months and that 75% of those with adult/eldercare responsibilities would need to consider eldercare options before accepting a new job or promotion. And this is not a gendered concern: more men than women indicated this. So, employers looking to attract older workers can get ahead by ensuring their programmes for carers are highlighted along with their other benefits.

  1. There is a rise in Employers seeking to support with childcare

A Parliamentary debate on 20th December confirmed widespread concerns about the lack of availability of affordable childcare for working parents. The Local Government Association sums it up this way: “Challenges caused by the systematic underfunding of early years provision are being exacerbated by the rising cost of living and inflationary pressures. This is negatively impacting the financial viability of early years providers, the quality and access of childcare provision, and the availability of good support for children with special education needs and disabilities (SEND).”

This is a pressing time for employers to ensure all parents can access the care and early education they need, in order to perform and flourish at work. We have seen a rise in enquiries about how support can be arranged. An onsite workplace nursery or partnership with a nearby nursery brings tax and NI savings for employees and NI savings for employers.

Employers are seeing it as important to act now to support employees rather than wait for reform. After consultations, discussions and a change in prime minister, it appears that earlier cost-saving proposals have been put on hold. Robin Walker, chairman of the Commons education committee and a former education minister has remarked: "I think any party which is aspiring to run the country now needs to set out a serious set of policies as to how we better support parents, particularly in the early years". The Education Committee has been inviting evidence on the needs, funding and impact of the Early Childhood Education and Care (ECEC) sector.

Meanwhile, we know from research conducted by Bright Horizons in September 2022, (Parents under Pressure) that over half of parents (53%) are now either occasionally or regularly doing without childcare while working and only 18% are happy working from home without formal care. Over half of those managing without care (55%) said it was a struggle, but they either couldn’t afford more paid childcare (35%) or couldn’t find the care they need (20%).

Our experience is that employers are also continuing to encourage the use of Back-Up Care when little ones end up at home unexpectedly while parents work, such as when a school is closed or the child is mildly ill (but happy to be looked after by a back-up nanny in another room while the parent works).

However care is provided or supported by employers, whether regular care or back-up care, this just-published video by the National Day Nurseries Association gives an insight into the value of early years education, and educators, and the importance of the first five years as a time for development. It reminds us that ‘childcare’ means much more than a place for children to be while parents work.

  1. Family is still top of mind: support is timely

In our 2022 Work+Family Snapshot (client employee survey), there was a very high priority placed on family life. When asked to reflect on the last 12 months, nearly 6 in 10 employees (58%) stated family had become a higher priority than before. This was a 10 percentage point rise on the 2021 figure. This trend was especially marked in the 18-34 age group, with two-thirds (67%) putting greater emphasis on family.

Supporting families in January is an important new year's resolution for employers. Many families will be feeling the strain after a festive season fuelled by credit card debt given the high cost of living. One of the many indicators of tension is the high incidence of divorce applications at this time of year. The first working Monday in January is grimly known as ‘Divorce day’. This year, family is also top of mind since Prince Harry’s revelations (or allegations, depending on the point of view) demonstrated that all families have their own issues and dysfunctions, however privileged or well-resourced they may appear. Our Work+Family Space consultants have huge experience in supporting couples who are helping children adapt to big changes in family life, among other areas, as well as coaching and advising on better communication before things break down.

Another element of family life to look out for is parents’ ongoing educational catchup concerns. The Government’s National Tutoring Programme is now moving away from its focus on ‘helping pupils catch up on lost learning’ towards ‘the long-established challenge of tackling the attainment gap’. This is a hugely important aim. However, it might limit the availability of catch-up tutoring for those who are not disadvantaged enough to qualify for the Pupil Premium. Many employers have now extended their Back-Up Care programme to include Virtual Tutoring as a support for concerned parents, which makes the service more inclusive, addressing further life stages.

Employers have also seen this as a valued aspect of their wellbeing provision: without virtual tutoring, 55% of parents would have ‘dedicated hours to tutoring my child directly’ and 32% would have experienced more stress at work (Bright Horizons user feedback surveys 2022). Virtual Tutoring has also formed part of employers’ cost of living support. Subsidising access to tutoring through Back-Up Care makes it cost effective, reducing financial pressures: 73% parents agreed that without access to virtual tutoring they would have used private tutoring with an impact on family finances (Bright Horizons user feedback surveys 2022).

  1. Employees look for encouragement, listening and shared values

In an uncertain climate there are choices as to how we all respond to finding ourselves in a new year, whether employers or employees.

What is the mood of most employees? For some, this new year has been more about finding what we might call the quiet quitting equivalent of New Year’s Resolutions: cutting back to what really matters and not feeling the need to appear over-busy at all times. For others the key to motivation may be resolutely reminding ourselves of reasons to be cheerful in 2023, from space launches to nature recovery.

It’s a vital time for leaders to convey a compelling – and inclusive – sense of vision, to pay attention to the employee experience, and to support people’s day-to-day lives, including of course family life.

Within Bright Horizons UK, the year started with a strategy day in which senior leaders came together to share information, tools and encouragement and start 2023 reminding ourselves of our important mission. Diverse stories were shared of the positive impact of recent successful projects, with a view to sharing these messages across all teams.

The 2023 workforce will also be increasingly motivated by knowing their employer’s values and purpose fit with their own. This will include a commitment to Diversity, Equity, Inclusion and Belonging, to minimising environmental impact and having a positive impact in the community. These attributes will increasingly be looked for – expected even – by current and prospective employees.

Legal and public policy updates

Statutory pay rises

Family leave pay (such as statutory maternity, paternity, adoption, shared parental leave and parental bereavement pay) will be rising by just over 10% to £172.48 in April. At the same time, the National Living Wage will see its largest ever increase to break the £10 barrier for over 23s, increasing by 9.7% from £9.50 to £10.42 per hour. The Government’s target is for the National Living Wage to reach two-thirds of median earnings by 2024.

Divided opinion over rules to curb industrial action

Amid ongoing industrial action, the Government has plans for new legislation to maintain a “basic function” in public services during industrial action. This could empower employers to bring injunctions to prevent a strike from taking place, or seek damages after the event if strikers and unions do not adhere to their obligations. The bill, being debated in Parliament, covers key services, including health, education, fire and rescue, transport, decommissioning of nuclear installations and management of radioactive waste and spent fuel and border security. Lawyers have warned it could be difficult to enforce and Paul Nowak, general secretary of the TUC said the bill offered “nothing more” to help with this year’s pay and criticised the Government for turning from “clapping key workers to threatening them with the sack” if they take industrial action. Nowak also warned this could “push” people away from essential jobs in public services. Unions have recently been granted permission for a judicial review against a previous change allowing agency workers to cover for staff on strike. It is possible that a similar challenge will arise on this change.

Business Secretary, Grant Shapps, has commented: “As well as protecting the freedom to strike, the government must also protect life and livelihoods. While we hope that voluntary agreements can continue to be made in most cases, introducing minimum safety levels — the minimum levels of service we expect to be provided — will restore the balance between those seeking to strike and protecting the public from disproportionate disruption.” Several other countries such as France and Spain already have minimum service agreements in place.

Extended family provisions and day 1 right to request flexibility

BEIS (the Department for Business, Energy and Industrial Strategy) published its response to its Making Flexible Working The Default consultation in December. New measures will be brought in to:

  • remove the 26-week qualifying period before employees can request flexible working, making it a day-one right
  • require employers to consult with their employees, to explore the available options, before rejecting a flexible working request
  • allow employees to make 2 flexible working requests in any 12-month period, and
  • require employers to respond to requests within 2 months

Most of this will be achieved through Yasmin Qureshi MP’s Employment Relations (Flexible Working) Bill while the day 1 right to request will come through amending the Flexible Working Regulations 2014.

As outlined November’s Monthly blog, among other Private Member's Bills going through Parliament that could affect provision for working families are: the Carer’s Leave Bill, the Fertility Treatment: Employment Rights Bill, the Neonatal Care (Leave and Pay) Bill, and the Protection from Redundancy (Pregnancy and Family Leave) Bill. Several of these cover measures hoped for in an Employment Bill as outlined in the Dec 2019 Queen's Speech but which had not progressed.

Childcare is part of the infrastructure

We have known for some time that childcare is a vital part of the fabric of society, for developing and supporting future citizens and enabling the current generation of parents to work, while their children receive quality education. Childcare and early education have now been formally recognised as part of the infrastructure under the Levelling-up and Regeneration Bill. This means childcare provision will qualify for funding under the local infrastructure levy, from developers building new housing.

Author: Jennifer Liston-Smith, Head of Thought Leadership, Bright Horizons