Below is a preview of what TOOTRiS CEO Alessandra Lezama will be speaking about on January 22 at the San Diego Business Journal Economic Trends panel. She will be joined by Mark Cafferty of the San Diego Regional Economic Development Corporation, Lynette Seid of Kaiser Permanente, Trindl Reeves of Marsh & McLennan Companies, Michael Pugliese of Wells Fargo, and Brett Good of Robert Half.
If you’re interested in where the region is heading, this is a must-attend event. Register now at sdbj.com/bizevents
Alessandra Lezama is the founder and CEO of TOOTRiS, an on-demand child care technology platform that is reinventing how parents access affordable, high-quality child care. A veteran technology executive who has enjoyed a 20+ year, high impact career turning under performing companies into scalable, high-performance powerhouses, Lezama’s hands-on approach has earned her a reputation as a rainmaker and she was named CEO of the Year in 2018.
Her most recent success as CEO of AbacusNext came in less than four years as she transformed a local 29 employee software shop into a disruptive global technology powerhouse, now with over 500 employees. Prior to joining Abacus, Lezama held CEO and COO roles for other technology companies including the largest data center operator in Southern California, American Internet Services (AIS), which she grew from one 15,000-square-foot facility to a combined capacity of over 150,000 square feet. Lezama lives in her adopted hometown of San Diego, where she is an advocate for women in STEM.
As an angel investor to San Diego-based early stage technology companies, Lezama currently serves on the board and management council of the San Diego Regional Chamber of Commerce and the board of Doors of Change, a nonprofit helping to break the cycle of homeless youth.
CEO Alessandra Lezama on Economy 2020: What’s Next?
The Child Care Industry Economic and Job Impact
About 11.8 million (58.7%) of children under age 5 participate in regular, weekly care arrangements with a nonparental provider. There are approximately 675,000 child care businesses – which are mostly small businesses – and produce revenue of approximately $47.2 billion and provide employment for 1.5 million wage, salary and self-employed workers in the United States.
In California, 1.6 million children are in paid child care with a total economic impact of approximately $12.84 billion. This consists of $5.79 billion in child care revenue plus a $7.04 billion spillover in other industries, a total earnings impact of $4.79 billion ($2.79 billion employee compensation and sole proprietors’ earnings plus $2 billion spillover earnings in other industries) and a total jobs impact of 222,948 jobs (163,332 sole proprietors and wage and salaried employees plus 59,616 spillover jobs in other industries).
Women, Labor Force & Child Care as Work, Education, and Training Support
Without affordable child care, parents — especially women — reduce their hours or opt out of the workforce. While participation rates are roughly equal for single and married mothers with infants, single mothers begin to enter the labor force at a much higher rate as the youngest child in the household reaches 1 year of age. For mothers with a 1-year-old, the participation rate is 69.3 percent for single mothers versus 60.1 percent for married mothers in 2019.
Labor force outcomes are also much less favorable for single mothers. In 2018, single mothers with young children under 3 were unemployed at a rate more than three times the rate of married mothers with children under 3 (9.9 percent versus 2.6 percent).
The organized child care sector continues to evolve to meet the growing demands of both working parents and employers in the United States. Some 94% of workers involuntarily working part-time due to child care problems are women. The recent stabilization in the share of women entering the labor force could be viewed as an economic development concern, as it indicates a limit on the number of new entrants into the labor pool. This has heightened the focus on access to affordable child care for women of working age who might otherwise opt out of the labor force.
Learn how expansion of the organized child care industry in the past several decades can help employers maximize the participation rate of women in the workforce.
Child Care in California Economic Growth and Development
There is a $28.8 billion impact to businesses nationwide due to child care related absenteeism. When child care isn’t readily available, parents and the organizations that employ them are impacted. The availability of paid child care plays a key role in allowing parents with children to remain in the labor force. Demographic trends and the cost of care remain key influences shaping overall child care usage. The cost of organized child care remains a significant financial hurdle, particularly for low-income and low-skilled workers.
Employers can be of great support at a much lesser cost as they incorporate a child care allowance to their benefits package to help attract and retain high valued employees.
Child care can facilitate a region’s economic growth through its support of increased labor force participation and education of the regional workforce. Especially for low-wage workers with children, the decision to work or seek additional education may depend on the availability of affordable child care. Affordable child care may encourage low-skilled parents to maintain their connection to the labor force or to upgrade their skills through education, both of which contribute to economic growth and productivity over the long term. State labor force participation rates are positively correlated with income levels and negatively correlated with poverty rates in the states.
The National Survey of Children’s Health (NSCH) found that about 8.7% of families (2 million) with a child under age 5 had someone quit a job, not take a job or greatly change a job in the past 12 months because of problems with child care. Child care subsidies encourage greater labor force participation, which in turn increases overall economic output in a region. Employer assistance was equivalent to more than one-third (37.3 percent) of the $47.2 billion in total revenue produced by the organized child care industry in 2016.