It pays for companies to be kind to families

By Prof. Roland Berger

Germany's cradles lie empty. The desire to have children is evidently becoming increasingly rare among Germans (both men and women). 2005 was the first year in which the number of births dipped below 700,000 – the lowest figure since 1946. The trend that has long kept the German birth rate at just 1.3 children per woman is clearly worsening.

The current demographic pattern poses a threat to more than just our old-age pensions. In the long run, a shrinking and aging nation will fall behind in competition with younger, upwardly mobile countries, both socially and economically. It is therefore time for the government, the business community and society in general to make life easier for families with children, and afford them the higher social standing they deserve. The good news for companies is that family-friendly policies don't have to be expensive. They are suitable for every kind of enterprise – and they pay off!

Studies show that employees who have families are more highly motivated, more loyal and less often sick. Compare, for example, a mid-sized family-friendly company with 1,500 employees with a similarly sized firm that does not operate such a policy. The former can cut personnel expenses to bridge gaps, absorb churn and recruit new people by as much as 25% in real terms.

Corporate culture, rather than the type or size of the company, determines which models work in which enterprises. There are plenty of options to choose from: flexible working hours, company childcare facilities, part-time arrangements, job sharing, and teleworking for parents on child-rearing leave. Re-entry programs provide for temporary replacements and let parents attend at least a one-week seminar before they return to work. This keeps them up to date on the latest developments and internal processes. Alternatively, companies can elect to work with service providers that offer advice to employees who need childcare facilities. Company kindergartens and daycare centers round out the portfolio of options.

By no means least, family-friendly policies are an ace in the hand of companies that are keen to attract top talent. Highly qualified staff of both sexes appreciate job offers that will make it easier for them to combine work and family life.

Young people enrich society in more than just material terms. Having said that, economic growth and a nation's prosperity depend on future generations. Companies can do their bit to make Germany a more child-friendly place – and do themselves a favor into the bargain.

(This column was published in "Rheinischer Merkur" on March 30, 2006)