One thing that we’ve learned over the years in both working individually with child care providers and in speaking with providers at conferences is that the financial piece of the business is not always one of the highest priorities. While caring for children and managing staff are absolutely critical, even the best program cannot continue operating unless it’s financially viable. Since labor costs are often 80% or so of a child care budget, this is one area that must be managed very carefully.
One tool that we use to manage our labor costs is our “Labor Cost Worksheet”. This tool helps us to manage a multitude of staff financial considerations such as:
- An overview of each staff member’s pay rate and how they compare to other staff members’ pay rates
- How much our staff benefits cost us
- How many hours of straight labor costs did we have vs training and overtime costs
- Why we incurred extra costs in training and overtime
- And, in organizing the list by classrooms, we can see all of these stats for each class
If you don’t already have a good method in place for tracking your labor costs, check ours out here. Next week we’ll talk about watching your ratios to maximize your staffing budget.