Child care in the United States had problems before the pandemic, and it feels like it’s only gotten worse. I wanted to know what lessons we’ve learned and how HR departments can continue to move the needle forward. So I sat down with someone who deeply understands this issue. Ilnort Rueda is the co-founder of Arvorie, a mission-driven platform that connects employers and parents with thousands of child care providers to tackle the accessibility crisis.
In our eye-opening discussion, llnort and I talk about the child care crisis, COVID, issues facing working parents, and how HR departments can do their part in improving the quality of child care. Ilnort shares his insight, saying that COVID-19 revealed problems we have been having for years. “The pandemic gave us kind of a window into the homes of people, and we saw children interfering with jobs and so on. And even though it was very visible, this is something that happens all the time.”
Whether you are a parent/caregiver yourself or not, if you’re in HR or manage people who are, you’re going to love this conversation. So, sit back and enjoy this chat with Ilnort Rueda.
The Role of Child Care During the Economic Recovery
Economic recovery will hit a wall without women or mothers in the workforce. There are estimates of 2.5 million women leaving the workforce and not returning because of problems with child care. Some would have us think that the talent shortage and unemployment benefits have a connection. However, the real reason people aren’t going back to work isn’t because they’re just making a ton of money collecting unemployment.
The misconceptions drove me to ask Ilnort about the role of child care in economic recovery, especially for working moms: “Unfortunately, the way that we have a structure, our society over the years puts a huge burden on that. And we are seeing how this is hitting now. What we think is going to happen is we’re going to see a very step-by-step going back to some type of new ‘normal.’ And that means that employers will have to have a little bit of patience in terms of how to accommodate for that.”
The pandemic is not over. Spikes and new variants pop up every day, and it feels like we are putting things on hold. But we are constantly learning and adjusting and finding what works. “I still think that remote work is going to be important, so we need to be creative,” he says. “And we have seen employers being extremely creative, like setting up some type of places for parts to work together, some space in their offices to take care of the children, tutoring, and so on. And so we’re going to see very, very different solutions in that direction.”
What the Best Companies Are Doing
I asked Ilnort to talk more about some of the opportunities we have to improve people’s access to quality child care. Specifically, I asked for some examples of companies that are knocking it out of the park.
One area where HR can step in: Offering benefits that help pay for child care expenses. “There are so many benefits that you can offer that cost you nothing,” Ilnort says. “So, that would be the minimum you should be doing. You can get a lot of them for free, but on top of that, you can really use, for example, these tax incentives that only employers have access to.”
But it’s also about changing our mindset about working families. Being a parent is a normal part of life for many people, he says, and employers should continue to find ways to support people in that stage of life. “So some of these return-to-work programs, I think, are very, very good in terms of demystifying things about lactation and feeding and stuff like that. I took a small leave when my son was born, and I really enjoy being a few months home and having that opportunity.”
All parents deserve that opportunity. So check out the entire conversation and see how you can do your part in creating much-needed support for the mothers and caregivers in your organization.
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People in This Episode
Full Transcript
Ilnort Rueda:
I think we have to remember that, of course, the child care crisis is an issue for the country and for society, but it’s a workplace issue as well, right? So, I don’t want to be too naive to say, “Oh, we have to be just parent-friendly because we need to be parent-friendly.” Of course, it’s the right thing to do. Nobody’s going to argue against that. But I think it’s also a way to be more competitive. You’re going to be attracting better talent. You’re going to be having a better engagement of your workforce. And I think it translates automatically into better performance, more commitments to your brand, and so on. So I’m sure that being parent-friendly has a huge correlation to being more competitive and a better citizen in this world, yeah.
Laurie Ruettimann:
Hey everybody, I’m Laurie Ruettimann. Welcome to Punk Rock HR. My guest today is Ilnort Rueda. He’s the co-founder of Arvorie. They are a mission-driven platform that connects employers and parents with thousands of childcare providers to tackle the childcare accessibility crisis. With Arvorie, companies build tailor-made programs, parents find high-quality childcare, and providers get access to a strong source of customers. Arvorie is an ecosystem. And the interesting thing about overseeing an ecosystem is that you get a glimpse of society. So, today Ilnort and I talk about the child care crisis, COVID, issues facing working parents and what HR departments can do to move the needle forward so we can all get back to work. Now, if you’re a parent or a caregiver or not, and you’re just in human resources, I know you’re going to love this conversation. So, sit back and enjoy this chat with Ilnort Rueda.
Laurie Ruettimann:
Hey, Ilnort. Welcome to the podcast.
Ilnort Rueda:
Hi Laurie. How are you?
Laurie Ruettimann:
Oh, well, I’m terrific. I’m so excited to have you on the podcast today. It’s been a long time coming, and you’re doing some cool work there out in the world. So, let’s get started. Why don’t you tell everybody who you are and what you’re all about?
Ilnort Rueda:
Sure. My name is Ilnort, and I’ve been in corporate life for many, many years. And a few years ago, together with a former client of mine, we saw that there was something wrong with child care in the United States, and we started digging deeper into the issue. And then we decided to set up a company to help parent-friendly employers, actually more parent-friendly in a more substantial way.
Laurie Ruettimann:
Well, it’s an understatement of the century to say that child care has some challenges here in the United States. So, maybe we can get started talking about that because, I think here in America, we are very far behind the rest of the world in how we look at child care, how we consider working mothers in the workforce. So, maybe we can talk about what companies learned during the pandemic about child care and work?
Ilnort Rueda:
I think the pandemic was a time where some things got an exponential or a very strong exposure of the problems we have been having for years, right? And the pandemic gave us kind of a window into the homes of people, and we saw children interfering with jobs and so on. And even though it was very visible, this is something that happens all the time, right? And companies, and even very engaged HRs, they are sometimes a little bit aware of the logistics, but sometimes there’s much more behind that — if we go to how expensive it is, the financial struggle. So, I think the pandemics gave us so many opportunities to see how far behind we are in getting some solutions. And I don’t even want to go into the direction of “the government should be doing more or less” and so on. That’s a huge one. But when we started the company, we asked ourselves, what can we do as parents, as spouses of working mothers to get this somehow better, right?
Laurie Ruettimann:
Well, I wonder if we’ve actually learned any lessons and what’s been going on in the child care sector in the last few months. And you’re right, government plays a role, and I’m optimistic with the infrastructure bill that here in America, we’ll be paying attention to child care a little bit more, but what’s been going on in that sector.
Ilnort Rueda:
Well, the sector went through a huge transformation in the last few months. You probably remember before the crisis, we used to have expensive child care and huge waiting lists. Quality was a big issue, and not every one of the providers had good quality, even though they are all regulated. And in the regulation, it’s very, very strict and very limiting, so that it adds to the cost of running a child care. And what happens during a pandemic is at the beginning, people just pull out of the service and a lot of child care providers were just not having any income anymore. Then we came to a phase where a lot of front-line workers needed some type of support just to keep the hospital running. So some of them had to come back and structure themselves to help. So we really started to sense, this is part of the infrastructure to make it work, right?
And today we have a situation with probably 20 to 30 percent of the providers went bankrupt. And a lot of the ones that still operate, they have a lot of idle capacity, partially because of the restrictions, but as the CDC and the whole recovery process starts, they need also our help to get back to operate and hopefully get some of the ones that got out of business back to business. And ideally get more supplies. If we think about from an HR perspective, people management perspective, all the getting back to work, even if it’s partially remote and so on, that’s going to be a huge part of the equation. There are restaurants that are not being able to reopen because people just don’t get child care. That’s unbelievable for me.
Laurie Ruettimann:
Well, I think this issue of child care and the post-COVID recovery is linked in such interesting ways. There are anywhere upwards of 2.5 million women who have exited the workforce and are not returning because of child care. There’s this issue of a talent shortage. There’s also this issue of unemployment benefits because apparently, some dudes in a couple of states think that people aren’t going back to work because they’re just making all this money on unemployment, when really the data shows that this is a child care issue. So, can you talk a little bit about childcare in the role of the recovery? You’ve touched on it, but I’d love to hear your thoughts a little bit more.
Ilnort Rueda:
Yeah, I like the additional dimension that you brought about women in child care plays a bigger role. Unfortunately, the way that we have a structure, our society over years, puts a huge burden of that. And we are seeing how this is hitting now. What do we think is going to happen is we’re going to see a very, step-by-step going back to some type of new normal. And that means that employers will have to have a little bit of patience in terms of how to accommodate for that. But I think they will also have to help these parents in a humane and very practical way on how to get back, right? And to a lot of that, it’s just hearing what their current needs are in trying to accommodate and trying to find something that makes sense for the employer and for the employee.
I still think that remote work is going to be important, so we need to be creative. And we have seen people, employers being extremely creative, like setting up some type of ways for parents to work together, some space in their offices to take care of the children at tutoring and so on. And so, we’re going to see very different solutions to that direction.
Laurie Ruettimann:
As I think about the role that HR has and reopening the economy and creating a world that’s open for business and this post-pandemic world that we’re living in. I wonder if child care benefits can really make a difference for companies to build a competitive advantage. Can you speak to that?
Ilnort Rueda:
Sure. I think that HR thought leaders have to be just more daring. Sometimes to have the impression that’s bolder in terms of making the case and doing a little bit of advocacy for some of the parents. Many of them are parents and know exactly what happens behind the scenes. And I think being bolder and bringing new solutions can be an important role, right?
Of course we have the traditional solutions, like backup care, like onsite child care, but we will know those are not the solutions that really work for everyone, right? On-site works for large companies. And, to be honest, a lot of the people that use it have to bring the children to the headquarters, and so on. That doesn’t work for most of the parents, right? And backup care, a lot of companies have just expanded that because they have that, but actually it’s, you’re not taking the problem by the roots. So, thinking about, how can we provide more, what we call primary care solutions, that really avoid these more unexpected solutions like backup care that are just for the unexpected situations and extremely expensive compared to others.
Laurie Ruettimann:
So, what are some of the primary care solutions that are out there?
Ilnort Rueda:
I think it starts very simple, as in terms of helping parents to find child care. So, there are true platforms that are already in the markets that do that. We do that, as well. And to also try to help them get better conditions, better deals. So if you are able to negotiate with a few child cares that are close to where your employees live, they can profit. As a company, you have a lot of credibility if you go to a chain or to a provider to do that. And it’s something that you should ask HR to consider is there is actually money from the government to help you do that. And it has been there for years. If we take a look at Patagonia and setting up an on-site child care in that headquarters many, many years ago, they recovered 50 percent of their expenses from the government. So there is actually a way to make the government pay for that. So using more of those solutions makes a lot of sense.
Laurie Ruettimann:
Well, I just want to clarify what you said, because most people in human resources say, “I’m a parent and I need better child care, but oh, it’s so expensive.” So I just want to clarify, can employers really just pass through some of the costs to the government?
Ilnort Rueda:
Yes. If an employer pays directly to the provider, partially or the full amount. The full amount, it’s quite a lot, right? But even if it’s only partially, you can get that money back from the IRS. And depending on the states — New York, where we are based, it’s one of the most generous states in that direction, and they just passed a new legislation. So, next year, if you add all the effects, you can recover 94 percent. So if you give $500, it doesn’t cost you $500, right? Why aren’t we using that?
Laurie Ruettimann:
I don’t know. That’s a really good question. I think there are human resources professionals who are just stretched so thin and try to figure out where their priorities are in the organization that align with their male-dominated executive leadership teams, and these dudes aren’t considering child care complexities.
Unless you can make the case for change in human resources, you’re going to be stuck doing things the way you did before the pandemic. And I don’t know about you, Ilnort, but I didn’t survive the pandemic to live like it’s 2019. So, I’m so grateful that you’re here to talk about some of the opportunities we can move child care forward in organization. So I just wonder, what are some of the most committed companies doing today for working parents? Give us some case studies about companies that are just knocking it out of the park.
Ilnort Rueda:
I would say, in general, companies that are putting a little bit of money on the table, right? There is so many benefits that you can offer that cost you nothing. So, that would be like the minimum you should be doing. You can get a lot of them for free, but on top of that, you can really use, for example, tax incentives that only employers have access to. So that should be part of that. It makes sense to start, for example, if you already have an ERG of women or of parents, let’s surface those, but really, what most advanced companies are doing is they’re really thinking about their specific part of parents’ needs, right?
So it’s not just thinking about generic solutions. Again, to backup care. Backup care, it helps, but it doesn’t solve the real problem, right? So is there a way to seal the real problem? Is there a way to better accommodate? Sometimes it’s around improving your paid leave policy, just to be more flexible. We will hope that it gets materialized through the new legislation and so on, but there’s something that we can do. I think that’s part of the basic, and the other is really helping find them the right child care setup, giving them options in terms of some additional support.
And probably more important is creating the awareness within the company that being a parent, it’s part of the personal life, and we need to juggle and to take it more normally, right? So some of these return-to-work programs, I think are very, very good in terms of demystifying things about lactation and feeding and stuff like that. I took a small leave when my son was born, and I really enjoy being a few months home and having that opportunity. I would really admire companies where also fathers are encouraged and really take it as part of normalcy to take that time, right? So I think companies that are really very parent-friendly are the ones that have managed also to change the culture into that direction. And that has to be a little bit with example and putting those programs in place.
Laurie Ruettimann:
Why don’t you tell us about your organization and how it’s looking to solve some of these problems in the workforce?
Ilnort Rueda:
We’re helping employers, employees and child care providers to approach, right? So, what we built, it’s practically a platform where we connect all this, and we’re trying to develop value-add services for all of them. On the child care provider site, we are helping them to get new children into their business, right? So, we have been doing a lot of promotion for them and try to help our partners get them because we have the link to the employers, so we can get additional demand for their services. And I think most importantly, on the employer side, we have embedded all these legal requirements into our payment systems. So that’s capturing all the tax incentives. It’s very, very easy. And we created something that is very open, so any state licensed provider can join our platform. So we don’t have something like, “oh, we have a close network of providers that we work with.”
So that makes it very easy. Especially for companies that onboard into our platform. Everybody can keep their provider, if it’s part of the coverage of the benefit program that the company decides. And at the end of the day, operationally, it works very similar to a commuter benefits where you can pay through our platform — with a big difference that it’s not your pre-tax dollars, but it’s also pre-tax dollars from the employer, that it’s really showing a strong commitment on that very specific issue. That’s the way we operate and we have more ideas for the future, but that’s where we started.
Laurie Ruettimann:
Well, you started at a really important place for both employers and employees. I love that you’ve done that. You’ve created this dual-sided marketplace, this ecosystem, right? Where people can meet the needs. They can really double down on their commitments to their employees. I mean, it’s just such a smart place. I wonder why you do the work that you do. You mentioned that you’re a father, you mentioned that you took some leave. Why start this company? What’s your why?
Ilnort Rueda:
My grandmother, who I admire a lot. She was an early childhood teacher and she worked 59 years. First in child care, then as teacher of teachers and at the end, in the regulatory body that defines the programs and things like that, sort of the whole ecosystem. That was in Mexico, where I grew up. So, it’s defining a lot from what I am and what I understand of how important that is. She wrote books about that that I read. But more recently, I would say I used to work for a consultancy firm, for Kearney. And I think the culture and the way that parenthood was handled and the way I experienced parenthood being at the company, it made a big difference for me, right?
So my wife has an executive career. I have a career, but we both had this additional support and time from the people and from the firms that made a difference for us. And I think that should be the case for anyone, right? It shouldn’t be the exception, which unfortunately I think it is, but that should be really the rule. So, we want to contribute to that direction. And my co-founder has a similar experience. So, we are very engaged in making child care affordable for everyone.
Laurie Ruettimann:
Well, I love that mission. As we wrap up the conversation today, I wonder what you want to leave our audience with? Our listeners are passionate about the world of human resources. They’re passionate about doing the right thing for workers, and many of them are parents themselves. So what do you want to leave everybody with?
Ilnort Rueda:
I think we have to remember that, of course, the child care crisis is an issue for the country and for society, but it’s a workplace issue as well, right? So, I don’t want to be too naive to say, “Oh, we have to be just parent-friendly because we need to be parent-friendly.” Of course, it’s the right thing to do. Nobody’s going to argue against that. But I think it’s also a way to be more competitive. You’re going to be attracting better talent. You’re going to be having a better engagement of your workforce. And I think it translates automatically into better performance, more commitments to your brand, and so on. So I’m sure that being parent-friendly has a huge correlation to being more competitive and a better citizen in this world, yeah.
Laurie Ruettimann:
But Ilnort, we’ll have all of your good stuff in our show notes today. And I just want to say thanks for being a guest on Punk Rock HR.
Ilnort Rueda:
Great. Thank you.
Laurie Ruettimann:
Hey everybody. I hope you enjoyed the conversation on Punk Rock HR this week. Now for more information, all the notes, all the highlights, all the resources, you know where to go. You can head on over to lurieruettimann.com forward slash podcast. Now that’s all for today, and I hope you enjoyed it. We’ll see you next time on Punk Rock HR.
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