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The Business Case for Employer-Supported Childcare in Vietnam - a Summary Photo credit: Ergon Associates, 2019 Associates, Ergon Photo credit: TACKLING CHILDCARE: The Business Case for Employer-Supported Childcare in Vietnam - A summary August 2020 2 TACKLING CHILDCARE: THE BUSINESS CASE FOR EMPLOYER-SUPPORTED CHILDCARE IN VIETNAM – A SUMMARY COPYRIGHT AND DISCLAIMER NOTICE ACKNOWLEDGEMENTS © International Finance Corporation 2020. All rights reserved. This publication was produced by IFC under the overall guidance 2121 Pennsylvania Avenue, N.W., Washington, D.C. 20433 of Henriette Kolb, Manager of IFC’s Gender and Economic www.ifc.org Inclusion Group. Hang Thu Vu, Gender Operations Officer, The material in this work is copyrighted. Copying and/or coordinated production of this report under the supervision of transmitting portions or all of this work without permission may be Amy Luinstra, Regional Lead for Gender and Economic Inclusion a violation of applicable law. IFC encourages dissemination of its Group in East Asia and the Pacific. Peer review was offered by work and will normally grant permission to reproduce portions of Ellen Maynes, Rudaba Nasir, and Sherrilee Le Mottee. the work promptly, and when the reproduction is for educational and non-commercial purposes, without a fee, subject to such The report was prepared in collaboration with an external attributions and notices as we may reasonably require. consultant team from Ergon Associates, led by Kirsten Newitt. The team included Kate Jelly, Phuong Le, and Ned Lawton. IFC does not guarantee the accuracy, reliability, or completeness of the content included in this work, or for the conclusions or IFC would like to thank the companies that hosted researchers for judgments described herein, and accepts no responsibility or case-study research, and the employees of these businesses who liability for any omissions or errors (including, without limitation, generously gave their time to discuss experiences and ideas. These typographical errors and technical errors) in the content whatsoever businesses are Evervan, Feng Tay, Greenland, Now Vina, Pou or for reliance thereon. The boundaries, colors, denominations, and Chen, and Taekwang Vina. other information shown on any map in this work do not imply any judgment on the part of the World Bank Group concerning The report also benefited from valuable inputs made by other the legal status of any territory or the endorsement or acceptance Vietnamese and international businesses and organizations, of such boundaries. The findings, interpretations, and conclusions including Adidas, Better Work Vietnam, HSBC, Maxport Ltd., expressed in this volume do not necessarily reflect the views of the Nike, Schneider Electric, the European Chamber of Commerce Executive Directors of the World Bank Group or the governments in Vietnam, UNICEF, and Vietnam Business Coalition for they represent. The contents of this work are intended for general informational purposes only and are not intended to constitute Women’s Empowerment. legal, securities, or investment advice, an opinion regarding the We would like to acknowledge the support of the World Bank appropriateness of any investment, or a solicitation of any type. Group’s Umbrella Facility for Gender Equality. The Umbrella Facility IFC or its affiliates may have an investment in, provide other for Gender Equality (UFGE) is a multi-donor trust fund administered adviceor services to, or otherwise have a financial interest in, certain of the companies and parties (including named herein). by the World Bank to advance gender equality and women’s empowerment through experimentation and knowledge creation to All other queries on rights and licenses, including subsidiary rights, help governments and the private sector focus policy and programs should be addressed to IFC Communications, 2121 Pennsylvania on scalable solutions with sustainable outcomes. The UFGE is Avenue, N.W., Washington, D.C. 20433. supported with generous contributions from Australia, Canada, International Finance Corporation is an international organization Denmark, Finland, Germany, Iceland, Latvia, the Netherlands, established by Articles of Agreement among its member countries, Norway, Spain, Sweden, Switzerland, United Kingdom, United and a member of the World Bank Group. All names, logos and States, and the Bill and Melinda Gates Foundation. trademarks are the property of IFC and you may not use any of such materials for any purpose without the express written consent of IFC. Additionally, “International Finance Corporation” and “IFC” are registered trademarks of IFC and are protected under international law. Ausgust 2020 TACKLING CHILDCARE: THE BUSINESS CASE FOR EMPLOYER-SUPPORTED CHILDCARE IN VIETNAM – A SUMMARY 3 Why this study, now and whom is it for? Globally and in Vietnam, organizations are beginning to realize legal requirements, and being contextualized to fit the specific the benefits of employer-supported childcare; some are starting workplace environments. to implement innovative and progressive solutions. Following the This Vietnam-specific research demonstrates business benefits by launch of the global study, "Tackling Childcare: The Business those who have done it and aims to inspire others to do the same. Case for Employer-Supported Childcare" in 2017 the International It aims to complement efforts by others, including UNICEF and Finance Cooperation (IFC) has done country-level research on Better Work Vietnam to promote family-friendly policies and the business case for employer-supported childcare in Bangladesh, practices in the workplace, as well as the government of Vietnam Cambodia, Fiji, India, Myanmar, and Sri Lanka. This study on as it moves forward with plans to expand access to quality early Vietnam adds to the growing body of evidence demonstrating childhood care and education. why employer-supported childcare is good for business, good for employees, and good for society (Figure 1). For further information on IFC’s work to explore There is no one-size-fits-all approach for employer-supported childcare in the private sector, please see: childcare, but a common set of key success factors are www.ifc.org/tacklingchildcare emerging: responsiveness to employees' needs, going beyond Figure 2: Benefits of employer-supported care for employers, parents, children, and society Employers Children • Strengthens recruitment • Enhances social, mental, physical, • Increases diversity and talent and emotional development • Enhances corporate reputation • Improves school readiness, retention, completion and achievement • Improves staff retention • Improves outcomes in adulthood • Increases productivity Employer- Supported Childcare Society Parents • Builds human capital • Increases gender equality • Saves health care costs • Improves work-life integration • Improves productivity and earnings • Enhances access to better, paid jobs • Enhances socio-economic development • Supports parenting and mental and physical well-being Source: IFC, 2017 4 TACKLING CHILDCARE: THE BUSINESS CASE FOR EMPLOYER-SUPPORTED CHILDCARE IN VIETNAM – A SUMMARY Why care matters in Vietnam context Rapid economic growth is expected to continue. The export- Women’s participation in the labor force is a driver for growth. oriented manufacturing sector is a key driver of economic growth While Vietnam has high levels of women's labor-force participation in Vietnam, with average annual growth rates of more than 10 at 72 percent compared to the global average of 47 percent, it percent since 2009. As the shift of low-skill light manufacturing remains persistently 10 percentage points lower than the rate out of China continues and new free trade agreements make more for men at 82 percent. Closing the gender gap in labor force markets easy to access, Vietnam's manufacturing sector is expected participation, according to McKinsey, alongside increasing the to grow even more in the future. To take advantage of this growth, number of women in high-productivity sectors and increasing the businesses in Vietnam need to recruit aggressively in a tightening number of hours women work, could add an estimated 10 percent labor market. Garment manufacturing alone is expected to add in annual GDP by 2025 compared to business-as-usual. millions to their workforce in the coming years, not to mention Sectoral productivity needed to boost business performance and high demand from other high growth sectors like electronics and spur further growth. Economic gains over recent years have banking. come from structural transformation: movement of labor out of The labor market is tightening. Vietnam labor supply is stagnant: agriculture to higher productivity manufacturing and services half a million workers join the labor force annually since 2012. As sectors, but much of this transition has already happened. If Vietnam rapidly transitions from a young to an aging population, Vietnam is to sustain its levels of growth, improving productivity the labor force is projected to shrink by 5 percent as a share of the within sectors is a must. Future economic gains rely on making population by 2040 (World Bank, 2016). better use of women's talent to stimulate productivity, growth, and develop human capital. Care responsibilities have an impact on participation in good jobs. While educational attainment between women and men is broadly equal, women remain over-presented in informal sector and low Accessible childcare is critical for good jobs paying jobs. Research shows that care responsibilities are among for women. In Vietnam, mothers with access to
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