Cut Costs, Not Quality: 6 Tips to Effectively Manage Preschool Labor Expenses
Managing labor expenses is one of the biggest challenges in running a preschool, but it’s essential to keep costs in check without compromising the quality of care and education you provide. Labor costs typically represent the largest portion of a preschool’s budget, and even small inefficiencies can add up quickly. In this post, I’ll share six practical strategies to help you manage these expenses effectively, ensuring your preschool remains financially sustainable while maintaining high-quality standards.
1. Avoid Overtime
Overtime pay can quickly inflate your labor costs, often unnecessarily. To minimize this, schedule staff for slightly less than eight hours per day, giving you a buffer for those who clock in early or stay late. This small adjustment can prevent costly overtime while maintaining flexibility for staff.
2. Schedule Staff Meetings Strategically
Staff meetings are vital to maintaining quality and team cohesion, but holding them after hours can result in significant overtime costs. Instead, consider implementing an early school release for staff meetings. A slightly earlier pickup time for families typically doesn’t disrupt their day too much and allows you to keep meetings within regular hours. Remember, skipping staff meetings to save money is not recommended you’ll risk compromising the quality of your program.
3. Audit Timecards Regularly
Perform monthly timecard audits to ensure staff hours align with their schedules. This can help you catch “minute munchers” who habitually clock in early or late, creating unnecessary labor costs. Addressing these habits proactively can make a big difference in controlling expenses.
4. Get Creative with Lunch Breaks
Don’t default to a standard 30-minute lunch break just because it’s common practice. Tailor lunch breaks to the needs of your school’s schedule. For example, offering 40- or 50-minute lunch periods might improve staff efficiency and allow you to optimize coverage during peak times. Flexibility in scheduling can lead to smoother operations and better cost control.
5. Adjust Staff Hours During Low Enrollment Times
When student attendance is low, reduce labor costs by allowing staff to come in late or leave early. However, avoid mandating reduced hours, as it can lead to resentment. Instead, ask for volunteers—someone is usually happy to leave early or come in later. This approach keeps morale high while managing costs effectively.
6. Reevaluate Operating Hours
If your school has consistently low attendance during certain hours (e.g., early mornings or late afternoons), consider adjusting your operating hours. You might also tailor hours by program—for instance, offering shorter hours for lower-ratio programs like infant care while keeping preschool hours longer. These adjustments can make a significant impact on your bottom line without compromising quality.
By implementing these six strategies, you can effectively manage labor expenses without sacrificing the quality your families have come to expect. Thoughtful scheduling, regular oversight, and creative solutions can help you find the right balance between cost control and maintaining a high standard of care.