SOUTHERN CALIFORNIA JOB MARKET : FITTING IN THE FAMILY : DAY CARE: BIG HIT AT THE OFFICE

Across the Paramount Pictures lot on Melrose Avenue, in the shadow of the studio water tower, past the Marx Brothers and Clara Bow buildings, within earshot of messengers on bicycles, costumers pushing clothes racks and story editors carrying clipboards, wafts a seemingly out-of-place sound: children at play.

The shouts and laughter emanate from the Paramount Child Care Center, tucked away in a corner of the Maurice Chevalier building and just across a narrow walkway from rows of film and television production offices.

In 1986, Paramount became the first company in the entertainment industry--and one of the few in any industry--to have an on-site day-care center for children of its employees. From a tentative and admittedly apprehensive beginning with just 30 children, the center has now grown to its licensed maximum of 42, with more than 130 children waiting to get in.

“In the beginning we were a little gun-shy,” says David Mannix, Paramount’s senior vice president of operations in the studio group. “We wanted to tread lightly and make sure it could be a success.”

Now, Mannix says, the company no longer sees its child-care center as something unique or out of place. “It’s like a health-care plan, something you just offer as a benefit that’s not subject to a traditional return-on-investment review.” Instead, Paramount measures the success of its program partly by the huge demand from its employees, Mannix says.

Another measure of Paramount’s success: other entertainment companies are moving quickly to set up their own child-care centers to remain competitive in an industry where employees with sought-after skills frequently shift jobs. Early this month, Warner Brothers and Columbia Pictures announced plans to set up a jointly operated center at their production facility in Burbank.

Employer-sponsored day-care services--from on-site centers such as Paramount’s to financial assistance that helps employees pay for baby-sitters or nannies--has become one of the hottest workplace issues of the late 1980s. And it’s not hard to understand why.

According to 1988 government statistics, 57% of all women with children under the age of 6 now work outside the home. And, perhaps more significantly, 51% of all women with children under the age of 1 do so.

What’s more, many women with young children now hold key jobs and are therefore less “expendable.” Their employers can no longer afford to lose them simply because child care is too expensive or difficult to find.

“Ten years ago, these demographics were not as well understood,” says Sandra Burud, who operates a child-care benefits consulting firm in Pasadena. “Also, management was less aware of the dimension of the problem. The employer typically wasn’t told of the stress level; complaining to your boss about your baby-sitter troubles was just something you didn’t do.”

Now, however, the situation is changing dramatically, Burud says, as more women in higher-level jobs take their concerns to top management and as more younger men with working wives share the child care burden. “Men are becoming more vocal about child care in the workplace,” Burud says, “but it’s still generally considered a ‘woman’s benefit.’ ”

The number of employers with on-site child-care centers jumped from 105 in 1978 to nearly 700 by 1987, according to figures compiled by Kathryn Perry at the University of Wisconsin. The number of employers with any form of child-care assistance for employees grew more than fivefold to 3,500 during the same period.

The idea of child-care facilities on the job is far from new, however. One of the first such centers was at a garment factory in Philadelphia, where women made uniforms for Union soldiers during the Civil War.

Through the years, the largest concentration of employer-assisted child care has been in hospitals and other fields that traditionally have a large proportion of women employees. In the Los Angeles area, Good Samaritan Hospital, Centinela Hospital and Methodist Hospital in Arcadia are among those with on-site day-care centers for children of employees.

“In order to recruit good people, hospitals, banks and government agencies with a lot of women employees simply had to offer top-quality, affordable day care; it was a competitive necessity,” says Bea Gold, executive director of Child & Family Services, a nonprofit Los Angeles organization that develops child care and other programs. CFS manages Paramount’s child-care center.

The importance of having good child care at or near an employee’s job can’t be overestimated, Gold believes. “At Paramount, some people have actually turned down jobs for more money elsewhere in order to keep their children in the day-care center here.” (In fact, the sharp demand for on-site care may highlight its one big disadvantage: if the employee leaves the company, the child almost always must leave the day-care center.)

Despite the rapid growth of employer-assisted child-care programs, many companies are still reluctant to offer them--especially day-care centers at the job site, Burud says. On-site centers “are a gamble because they’re so expensive to start and because they require expertise that a lot of companies don’t have,” she says.

Paramount won’t say how much it cost the studio to start its center in 1986, but it’s apparent that it was expensive. Office space in the vintage Chevalier building had to be extensively renovated and brought up to modern earthquake-resistance and fire codes; strict state laws dictating the amount of playground space outdoors meant installation of a sandbox and jungle gyms where a garden had been. The company also had to seek a variance from city zoning codes to operate a day-care center in a manufacturing facility, and its liability insurance coverage had to be changed and improved.

In addition, the studio pays the center an operating subsidy each year so it can “offer the quality of care that we want,” Mannix says. The subsidies have permitted Gold’s agency, which runs the center, to pay higher wages and hire more staff than an average day-care center supported only by parents’ payments.

Then there are the intangibles, Mannix says, “the things they don’t prepare you for in business school.” In that category fall such things as the outbreak of chicken pox and the lawn that kept dying on the playground.

The cost and intricacies have prevented many firms from offering child care. Mannix readily acknowledges that Paramount’s center was approved in late 1985 without what he called the “quagmire of surveys and studies” that precedes most important business decisions.

The reason? An important producer leaned heavily on top Paramount management to set up the center. Gary David Goldberg, producer of the hit TV comedy “Family Ties,” had operated a day-care center in Berkeley with his wife before he became involved in TV production. He saw the need for on-site child care, especially in films and television where employees often work long and erratic hours, and pushed hard for it.

“This one got no analysis,” Mannix says. “It was approved right away.”

But Paramount’s experience is unique, and most companies still demand traditional cost-benefit analyses and return-on-investment studies before deciding whether to offer employer-assisted child-care programs, Burud says.

To prove that such programs are cost-effective, Burud’s consulting firm recently concluded a study of the on-site child-care facility at Union Bank’s operations complex in Monterey Park. Opened in 1987, the day-care center now accommodates 58 children aged 6 weeks to 5 years. It has a lengthy waiting list.

Among the conclusions of Burud’s study:

- Turnover of employees using the on-site center was 2.2% annually, compared to 9.5% for employees using other forms of day care.

- Employees using the day-care center were absent from work an average 1.7 days a year less than other parents of young children.

- The maternity leave of mothers using the bank’s center was 1.2 weeks shorter than for others.

- About 27% of new job applicants said the day-care center was an important factor in their decision to apply to Union Bank.

Burud’s study concludes that, although the center cost Union Bank $430,000 to build and required an operating subsidy of $105,000 in its first year of operation, the day-care center produced savings for the bank of between $138,000 and $232,000 that year, measured in terms of traditional return on investment.

But if top corporate management needs such cost-benefit studies to decide whether employer-assisted child care is a good idea, most parents of young children apparently don’t. Interviews with a sampling of parents who stopped by the Paramount center recently to visit their youngsters evoked lavish and uniform praise.

“I don’t know if I could have continued to work without this place,” said Louise Granhan, a Paramount data processor with two children aged 2 1/2 months and 2 1/2 years in the day-care center. “It makes for much happier, much less anxious employees.”

Kit Stolz, a story analyst, believes that his productivity at work has improved since daughter Annie, 4 1/2, entered the center. “There’s so much less driving, to drop her off and pick her up, and I don’t have to worry about leaving work early to get her.”