Innovative ways childcare providers are tackling staff shortages and attrition.
Attrition has long been a major issue in the early childhood education and care sector, putting pressure on providers to retain existing and recruit new staff to meet the required ratios. With a lack of overseas travellers over the last few years and also isolation requirements due to Covid-19, staff shortages have become even more common.
The sector’s turnover rates of up to 30% have meant existing staff are often overworked to meet ratio requirements. This comes at a significant cost to businesses, with two of the largest costs in the early childhood education and care sector including hiring and training new staff.
The high turnover creates a loss of educator skill and experience in the sector, increasing pressure on an already low staff morale.
United Voice, the union which represents ECEC workers, says that about 180 educators leave the sector each week because of low wages and poor conditions.
A 2021 report by the United Workers Union found 37% of educators didn’t plan to stay in the sector long term and 73% planned on leaving in the next three years.
Separate research found that twenty percent of the workforce intend to leave the profession within 12 months. Almost one in two educators who plan to stay think about leaving ‘all the time’, according to the union’s report.
Qualitative analysis of early childhood educator interviews identifies ‘work conditions’ as the single most important factor explaining staff exits. Work conditions refer to pay, flexibility of work, certainty of work hours and the opportunity for career advancement.
Flexibility may be the buzzword of the working world, but it needs to be broader than just working from home. For those in people facing roles, like childcare workers, the idea of working from home is not a realistic prospect.
Forward-looking organisations are taking the time to talk with their employees through internal webinars and Q&A sessions to understand their employees’ main concerns.
Two solutions that stand out in the childcare space are:
While extending hours may work for some providers, some families and employees may be looking for shorter sessions of care or greater choice about what hours they use and pay for. Flexible sessions are one way childcare centres can align operating hours with family needs.
Under Family Assistance Law, early childcare services can provide flexible sessions and these flexible sessions could even help to reduce overall staff costs. According to the Child Care Service Handbook, the maximum length of long day care sessions are 12 hours. But operators can be approved to operate for more than 12 hours by providing multiple sessions.
These extended hours could mean better alignment with the needs of families, while also providing employees with greater flexibility when it comes to taking shifts. Employees that have commitments like family or study can then make their shifts work around their lifestyle, rather than feeling like they’re stuck trying to juggle all their commitments.
While there have been some positive changes for qualified early childhood educators' pay in some states and across individual providers, more needs to be done to reduce the financial stress of these workers.
Seven in 10 educators say they ‘always’ or ‘often’ worry about their financial situation and more than eight in 10 say they would find it difficult to cover an unexpected expense of $400.
Employers have traditionally tried to reduce attrition with extrinsic rewards such as higher pay, bonuses or even gym memberships, but innovative companies are looking to more holistic solutions that can have a tangible impact on employee financial wellbeing.
One of these solutions is flexible pay, which is also known as ‘earned wage access’. Wagestream is a financial wellbeing platform that gives employees more control over their finances by enabling them to track and access their pay as it’s earned, meaning they can manage their budgets on a schedule that suits them and get immediate compensation from taking extra shifts, reducing the need to borrow.
Access to earned wages can significantly reduce stress for early childhood educators. Our research has found that casual staff who have access to earned wages take up more shifts, as they know this can help them meet expenses between pay periods.
This kind of support can also have a tangible impact on employee retention rates, with an Ipsos MORI analysis of Wagestream finding that employee retention rates were on average 5 percentage points higher in the 12 months after the financial wellbeing platform was implemented.
You can read more about how to reduces educator stress and turnover in the early childhood and care sector by focusing on employee financial wellbeing in our latest report.