HR’s new challenge: whole-family care
A new approach, based on innovative principles used in healthcare, can help companies lower turnover and boost productivity.
On Mother’s Day 2016, Sheryl Sandberg, COO of Facebook and author of Lean In, wrote a notable Facebook post: “I did not really get how hard it is to succeed at work when you are overwhelmed at home.” Sandberg was specifically talking about single mothers (her husband died unexpectedly in 2015). But she could have been speaking for the millions of Americans who struggle to balance the responsibilities of work and family life.
Some of Sandberg’s critics saw her candor as a refreshing change of heart. After all, the central thesis of Lean In is that women need to be bolder and more ambitious at work if they want to get ahead. But critics had pointed out that many people (particularly women) are prevented from devoting themselves more fully to their careers for a simple reason: They’re taking care of family members.
This highlights a defining conundrum of our age. Changes in demographics and social dynamics have made employees increasingly responsible for members of their extended family. Compounding the problem, skilled professional caregivers — both for children and for elderly people — are in short supply in many markets. And the onus is almost always on employees to find the best solution for their needs, and then to try to pay for it.
Today’s workforce is not only more diverse in terms of gender and ethnicity than it was several decades ago, it is far more diverse in terms of life circumstances, with employees who — in general — must deal with much greater family responsibilities. In the past, child care was typically handled by mothers while fathers worked. Chronic medical conditions such as diabetes, Alzheimer’s disease, and obesity weren’t as prevalent, and the healthcare system was easier to navigate. As a result, companies were able to treat those issues in situationally specific ways. An employee might need special accommodations for a short time, and that was it. In today’s more complex environment, that kind of ad hoc approach is falling short. Most employees confronting such circumstances are unsupported and ill equipped for their caregiving responsibilities.
And yet many companies continue to rely on HR policies and employee benefits programs built to suit the needs of two generations ago, when most private-sector workers were male and married to stay-at-home wives. The result is that many companies are not getting the most out of their talent, even as they struggle to compete for college-educated workers.
To adjust to the new realities, companies must implement new policies and adopt a new mind-set. They should do a better job of supporting employees in fulfilling their caregiver responsibilities outside the office. That will reduce voluntary turnover and allow employees to focus on their job when they’re at work. This approach, which we call “whole-family care,” is an integrated program that helps employees meet the needs of their family in a comprehensive, seamless manner. The goal is to reassure employees that the right person will deliver the right care or service at the right time, relieving them of the burden of assembling, coordinating, and managing such resources. This complex idea boils down to three core elements: more-tailored benefits packages, improved coordination and communication, and superior technology.
Forward-thinking companies such as Google and Facebook are already revolutionizing employee benefits by applying such principles. As a result, they’re attracting top talent. Of course, those companies have the financial means to offer gold-plated benefits packages. Moreover, they operate in an industry (technology) and geographic market (the San Francisco Bay Area) where the competition for talent is especially fierce. Yet we believe that virtually all companies can — and should — apply some aspects of whole-family care to their benefits. The right combination will vary from one company to the next, depending on industry and geographic region. Instituting some form of whole-family care will allow them to better meet the needs of their employees, increase retention, and ultimately improve company performance.
Absent — or Barely There
U.S. businesses forgo up to an estimated US$33.6 billion per year in lost productivity from full-time workers because of their caregiving obligations, according to a 2012 study by the AARP’s Public Policy Institute. Much of that loss stems from absenteeism — i.e., when people need to time off to care for a sick child or drive an elderly parent to a doctor’s appointment. Of the $74 billion in total costs due to absenteeism in 2013, about one-fourth came from providing care for others. Only employees’ personal illness cost more. Beyond absenteeism, “presenteeism” — in which employees who are at the office are not fully focused on work — is potentially an even bigger factor. Although the phenomenon is not as well studied, a 2004 Harvard Business Review article estimated presenteeism as a $150 billion problem. Take a walk around most office settings today and you’ll see it firsthand.
Many factors contribute to employee distraction: the Internet, shortened attention spans, poor morale, and such ever-present temptations as solitaire and Candy Crush. Yet for employees with families, caregiving responsibilities are clearly highly distracting. We know, for example, that child-care issues cause more absenteeism than any other family-related matter, accounting for 72 percent of all absenteeism.
Our research indicates that care-related concerns contribute substantially to presenteeism as well. According to a survey we conducted last fall, employers recognize that caregiving responsibilities have a negative impact on productivity. About half of survey respondents said caring for a newborn or an ill or disabled family member leads to the biggest drop in employee productivity. In addition, 13 percent responded that such responsibilities also led to significant levels of voluntary turnover. Changes in the composition of the private-sector workforce have made these issues inevitable. Women, the traditional source of caregiving for children, the infirm, and the aged, moved into the workplace without mechanisms for offsetting the loss of time available to spend on care obligations. In 1955, according to the Bureau of Labor Statistics, women made up just 32 percent of the workforce in the United States. By 2016, that proportion had increased to 47 percent.
In addition, the average age of first-time mothers has risen by more than three years since 1980, to 27. Many women now have children into their 40s, and the birth rate among mothers in this age group almost doubled over the last three decades, according to the Centers for Disease Control and Prevention. Because older women are more likely to have senior positions, with greater responsibility and higher salaries, their absence due to caregiving responsibilities carries greater implications.
In addition to caring for young children, many employees now take care of other members of their extended family. Older people live longer than they used to; the U.S. population older than 85 more than doubled in the past two decades (although life expectancies have declined for some demographic groups recently). As a result, many people require longer periods of care from family members, sometimes due to serious, chronic medical conditions such as heart disease and high blood pressure. According to the Alzheimer’s Association, currently, 5.4 million people have Alzheimer’s, or one in nine people age 65 and older. In 2015, more than 15 million caregivers provided roughly 18 billion hours of unpaid care for people with the disease. And projections call for the number of those with Alzheimer’s disease to nearly triple by 2050, to almost 14 million. Some 42 percent of U.S. workers provided care for an aging relative or friend between 2005 and 2010; the number is almost certainly higher today.
There are simply not enough trained caregivers in the United States. Supply does not meet demand, and the supply that does exist is highly fragmented. That leads to high costs in urban areas (where some employees have the means to pay more) and no available options in others. Quality of care can also vary widely, not only among facilities but even among individual providers. The imbalance is not likely to change — economists predict a gap of more than 1.3 million certified caregivers in the next decade.
In many fields, such a shortfall would lead to a rise in wages, and to people rushing in to fill those roles. However, the “caregiver” role is not a defined career path in the U.S. (as it is in many other countries). The wages and benefits for caregivers can vary widely depending on where they work — and who they work for. But in general, the pay is close to minimum wage, with few additional benefits such as paid time off for vacations or sick days. As a result, there’s not enough incentive for new people to become caregivers and meet demand.
Technology is starting to connect supply with demand. National care platforms, such as Care.com and UrbanSitter, and smaller to midsized agencies such as Poppy and Helpr, connect individuals with caregivers. Although such platforms are helpful, they still put the burden on employees to find, evaluate, and hire caregivers — and to figure out a way to pay for it all. Moreover, there is no certified vetting process beyond user reviews, even though these are complex services that require more insight than a Yelp-style review from recent customers.
Owing to the high costs associated with child care and eldercare— and the lack of providers in some areas — many employees, especially women, opt to simply leave the workforce and take on the task themselves. Voluntary turnover has a negative impact on productivity and skill sets, and triggers transaction costs for the employer in replacing the departed worker. Direct expenses include exit costs, recruiting, interviewing, hiring, orientation, and temporary staffing. Indirect costs include lower productivity due to temporary staff, reduced quality while a new employee learns his or her job, lower morale, and lost institutional knowledge and relationships. The Center for American Progress estimates that the average cost to replace an employee is 16 percent of his or her annual salary for low-paying jobs, 20 percent of the salary for midrange positions, and more than twice the annual salary for highly compensated executive positions.
The Solution: Whole-Family Care
Human resource functions have not been oblivious to these changes, but their response has been fragmented. Employers may offer options such as paid or unpaid parental leave, reduced work hours, or telecommuting opportunities. Such benefits may enable an employee to remain in the workforce, but they do not address the larger issues that affect an ever-growing percentage of the workforce.
Employers need to reevaluate their benefits programs using a new standard: Do they provide a basis for staying with the company to valued employees who wish to stay employed but confront serious care-related life events? To help employees meet those caregiving responsibilities, HR departments can borrow an idea that’s gaining momentum among doctors and insurers: whole-person care. The idea behind whole-person care is that many people have complex medical needs that can’t be addressed through the traditional approach to medicine of taking a trip to the doctor and getting a prescription.
Consider a patient with diabetes and obesity, two conditions that can exacerbate each other. Such patients, particularly those with low incomes or other sources of instability in their lives, frequently end up in the emergency room for some urgent health crisis. They’re typically admitted for a few nights and then sent home with new prescriptions and a follow-up appointment weeks later. Yet no one addresses the underlying cause of the problem. Maybe the patient doesn’t take her medication according to instructions. Maybe she doesn’t have a reliable car with which to get to the doctor. Maybe she does not know how to cook for herself, so she eats fast food multiple times a day. Traditional healthcare models don’t consider these complicating factors, so the patient enters a cycle of treat–release–repeat. A month later, she ends up back in the emergency room.
Whole-person care, as the name suggests, seeks to treat people in a more comprehensive fashion. It consists of several elements, starting with a care coordinator who oversees all aspects of the person’s care — not only medical, but also behavioral and long-term care. External groups such as government agencies, faith-based groups, and the patient’s family and friends play a role. Wearables and analytics are used to help monitor the patient’s health and communicate metrics, such as weight, vital signs, and insulin levels, to doctors. This is a challenging approach, because it requires an up-front investment and a lot of coordination. And the healthcare industry is in many ways just embarking on this journey. But it may lead to demonstrably better results for patients, and at much lower costs over the long term.
The HR equivalent — whole-family care — applies the same kind of multifaceted approach for employees with caregiving needs. Specifically, it entails three elements: (1) tailored benefits packages that help employees meet their responsibilities outside the office; (2) better coordination and communication with employees regarding available benefits; and (3) the use of technology to help employees meet their caregiving responsibilities.
To attract and retain top talent, employers need to provide additional, differentiating benefits beyond a competitive salary and some health insurance options. A first step is to assess employee demographics to determine the caregiving issues that workers confront. Part of the reason whole-person care works in treating medical conditions is that people with the same condition have highly similar needs. The same logic applies to the whole-family care model. In any given workforce, some common and important life events will be shared by workers (a newborn baby, a spouse with a life-threatening illness, an elderly parent who can no longer live independently). Companies should identify such shared patterns for the most important members of the workforce and enhance the benefits available to employees experiencing those events.
Employers may also want to survey former employees who left the firm voluntarily in response to such events, or recruits who decline job offers. Asking why productive colleagues left the company and what, if anything, might have been done to make staying with the firm more should shed light on areas for improvement and benefit design enhancements.
Once companies have made a list of needs, they can start to prioritize those needs. For example, instituting flextime or condensed workweeks — e.g., four 10-hour shifts rather than five eight-hour shifts — is a fairly straightforward way to give individuals more control over their work and meet their responsibilities outside the office. Companies such as allow employees to adjust their hours around their children’s schedules or telecommute, and some even offer career breaks and reentry options. Researchers at the University of Minnesota — in conjunction with a corporate initiative called the Results Only Work Environment — found that employees with flexible hours don’t work less or at lower quality levels. Rather, workers experience better overall well-being and higher job satisfaction. Another study that was focused on high-profile consultants with flexible work schedules found that these employees outperformed their coworkers, earning more frequent promotions and better performance reviews.
Better Coordination and Communication
Ensuring that employees understand what benefits are available to them, what other services they should consider, and what the associated costs are is critical to making such programs work, which is why the whole-person model of healthcare starts with coordinators who reach out to patients with complex medical needs and guide them in coordinating various aspects of care. The HR equivalent requires coordination as well, which in turn requires employers to change the nature of the dialogue with affected employees.
Rather than relying on employees to sort through the various combinations of services that might address their needs, companies should provide the type of informed guidance that physicians provide to patients under whole-person care. Throughout the process, an HR rep is a single point of contact who identifies required services, ensures that the employee receives them, and monitors the quality of care. In this way, the HR rep becomes a kind of “sherpa” who guides employees through all aspects of a particular life experience. In larger organizations, such integrated guidance could be provided by HR professionals who specialize in specific life path events, such as caring for a chronically ill parent.
An HR rep is a single point of contact that identifies required services, ensures the employee receives them, and monitors quality of care.
In all instances, employers should help employees understand the financial consequences of such life path events and the associated solutions. Many employees at all income levels already feel they are under financial duress. According to PwC’s 2016 Financial Wellness survey findings, 40 percent of employees find it difficult to pay their monthly expenses; 51 percent carry balances on their credit cards; and 36 percent have a difficult time paying the minimum credit card payment each month. Many millennials enter the workforce with heavy student loan debts. A major life event only adds to that financial stress.
The first two elements of whole-person care — tailored benefits packages and better coordination — will almost certainly require an investment on the part of companies. This investment will yield returns over time, as employee productivity and retention increase and absenteeism and presenteeism decline. However, technology can help companies implement whole-person care even more efficiently. At the most basic level, technology can free people from the physical constraints of the office, allowing them to work remotely during non-business hours, even collaborating on team projects. As a result, they can better meet the needs of family members.
Advanced digital tools and apps are emerging that can help. For example, as noted above, online talent platforms can help match supply and demand. Companies have already rolled out services that help employees monitor their own stress levels, physical activity, diet, and even ergonomics, and offer incentives to reward progress. Similar tools are increasingly available to help care for children and the elderly. Other emerging technologies:
• Personal emergency response systems allow users to press a button and be connected to a call center that can dispatch help and notify caregivers. Many also contain GPS functions.
• Home activity tracking systems use discreet wireless sensors placed in the home to track the movements and activities of a loved one. The caregiver can check in at any time using a private, secure Web page. If there are any disruptions to the daily routine, the caregiver can opt to receive an alert by phone, email, or text.
• Programmable alerts use buzzers, bells, or email to remind recipients to take their medications. They can also inform caregivers about missed doses.
• Applications such as Total Baby and My Kid’s Health provide a single, consolidated means of tracking children’s health events such as vaccination schedules, doctor and dentist appointments, growth and illness histories, feedings, naps, diaper changes, and more.
Because technology is advancing so rapidly, it’s unrealistic to expect employees to know everything that’s available or relevant for their needs (let alone figure out how to use specific apps and tools). Monitoring this technology and understanding its applicability to specific segments of the workforce is an appropriate role for the HR sherpa.
Investing in the Whole Family
The war for talent will be won on the basis of how well a company stands behind its people. Rather than treating them solely as a way of maximizing financial returns, companies should invest in employees as a genuine resource. The whole-person healthcare model is already leading to better results at lower costs, and whole-family care coordination can achieve similar gains for employees with significant family responsibilities. Beyond paying for themselves by lowering absenteeism, presenteeism, and turnover, these policies will signal to workers that they work for a company that supports them when they truly need it.
- Keith Fengler is an advisor to executives in the healthcare industry for Strategy&, PwC’s strategy consulting group. Based in Boston, he is a principal with PwC US.
- Joseph Fuller is a professor of management practice at the Harvard Business School.
- Scott Olsen is the leader of PwC’s Human Resources Services (HRS) practice. Based in New York, he is a partner with PwC US.
- Also contributing to this article were Jiemei Geng, manager at Strategy&; Shirley Sun, research associate at Harvard Business School; and John Sviokla, marketing leader for PwC US.