Typically, the effects of parental leave are improvements in prenatal and postnatal care, including a decrease in infant mortality. The effects of parental leave on the labor market include an increase in employment, changes in wages, and fluctuations in the rate of employees returning to work. Leave legislation can also impact fertility rates.
On the labor market A study in Germany found that wages decreased by 18 percent for every year an employee spends on parental leave. Parental leave can lead to greater job security. If women take long parental leaves, an economic model predicts that their lifetime earnings and opportunities for promotion will be less than their male or
childless counterparts—the "
motherhood penalty".
On workforce Paid parental leave
incentivizes labor market attachment for women both before and after birth, affecting the GDP and national productivity, as the
workforce is larger. Parental leave increases income at the household level as well by supporting
dual-earner families. Paid parental leave
incentivises childbirth, which affects the future workforce and pensions.
Statistical discrimination In case of
employer liability the parental leave costs incentivise
statistical discrimination against hiring women of child-bearing years. To counteract this, the cost impact can be spread more evenly across the labor market, for instance through
health insurance covering parental leave with contributions independent of gender and age.
Occupational sex segregation Women may seek out employment sectors that are "family-friendly" (i.e., with generous parental leave policies), resulting in
occupational sex segregation. Nielsen, Simonsen, and Verner examine what the different outcomes for women in Denmark are between the "family-friendly" and the "non-family-friendly" sector.
On economy The economic consequences of parental leave policies are subject to controversy. According to a 2016 study, the expansion of government-funded maternity leave in Norway from 18 to 35 weeks had net costs that amounted to 0.25% of GDP, negative redistribution properties and implied a considerable increase in taxes at a cost to economic efficiency.
Maternity leave and its effects In the U.S., while the
Family and Medical Leave Act of 1993 (FMLA) allows for unpaid parental leave, parents often do not use this eligibility to its fullest extent as it is unaffordable. As a result, some studies show that the FMLA has had a limited impact on how much leave new parents take. Though specific amounts can vary, having a child (including the cost of high-quality childcare) costs families approximately $11,000 in the first year. and just over half of mothers in the United States with a child under the age of one work. There is some evidence that legislation for parental leave raises the likelihood of women returning to their previous jobs as opposed to finding a new job. This rise is thought to fall to between 10% and 17%. Simultaneously, there is a decrease in the percentage of women who find new jobs, which falls between 6% and 11%. Thus, such legislation appears to increase how many women return to work post-childbirth by around 3% or 4%. Additionally, it appears that parental leave policies do allow women to stay home longer before returning to work as the probability of returning to an old job falls in the second month after childbirth before dramatically rising in the third month. Although this legislation thus appears to have minimal effect on women choosing to take leave, it does appear to increase the time women take in leave.
Paternity leave and its effects The term 'paternity leave' refers to the leave that is exclusively granted to the fathers to enable them in spending time with their new-born child. Although parental leave is increasingly granted to fathers, mothers continue to take the majority of guaranteed parental leave. In Germany, where parental leave is guaranteed for both parents, the financial incentive, alone, was not enough to encourage fathers to take paternal leave. While uncommon on a world scale, some countries do reserve parts of the paid leave for the father, meaning it can't be transferred to the mother and lapses unless he uses it. Among the earliest countries to actively push for increased usage of paternity leave are the Nordic welfare states, starting with Sweden making parental leave gender neutral in 1974 and soon followed by Iceland, Denmark, Norway and Finland. These countries lack a unified concept of paternity leave, each imposing different conditions, ratios and timescales, but are regarded as among the most generous in the world. Partly in an initiative to combat the "motherhood penalty", Norway in 1993 initiated a policy change to incentivize
paternal leave, the so-called "
father's quota", and Sweden followed suit in 1995. This means a certain number of parental leave-days can only be used by the father, and are otherwise lost. In countries in which leave entitlements include a father's quota, there has been a pronounced impact, with the quota being credited for increasing paternal involvement and challenging gender roles within the family, promoting a more equal division of labor. To evaluate this change, Rønsen and Kitterød looked at the rate and timing of women's return to work after giving birth, and the effect on this of the new parental leave policy. In their 2015 study, Rønsen and Kitterød found
women in Norway returned to work significantly faster after the policy change. However, public or subsidized daycare was greatly expanded at the same time, so Rønsen and Kitterød did not find that the "father's quota" was solely responsible for the timing of work entry. But it can be understood to have an effect on
division of household labor by gender when both parents can take time to care for a new baby. In some cases, longer leave for fathers can motivate mothers to also stay home. and this difference may have factors other than the financial constraints which impact both parents. Bygren and Duvander,
Criticism of the 'father quota' The father's quota is a policy implemented by some countries or companies that reserves a part of the parental leave or other types of family leave for the father. If the father does not take this reserved part of leave, the family loses that leave period—that is, it cannot be transferred to the mother. Given the high rates of women's participation in the formal labor force in many parts of the world, there is increasing interest among social scientists and policymakers in supporting a more equal division of labor between partners. Some critics question whether such policies are evidence-based and express concern that they are "a social experiment, the effects of which are unknown". However, other studies have shown that paternity leave improves bonds between fathers and children and also helps mitigate the wage gap women face after taking maternity leave. Other psychological perspectives summarise evidence and find that the role of a father in child development is very similar to that of a mother, counteracting the concern that greater paternal involvement in childcare could lead to unforeseen negative consequences. Criticism is often less concerned about the idea of paternity leave itself, but condemns the fact that father's quota policies do not allow that time to be allocated to the mother instead. Critics argue that the quota harms mothers, depriving them of much needed leave, trivializes biological realities, and is an example of discrimination against mothers. In the European Union, non-transferable parental leave remains a controversial issue. It was first introduced by the
Parental Leave Directive 2010, which required at least one month of the minimum four months of parental leave be non-nontransferable; this non-transferable period was increased to two months by the
Work–Life Balance Directive of 2019, which must be transposed by member states at the latest on 2 August 2022. Originally, the plan under the Work–Life Balance Directive was to increase the non-transferable period to four months, but due to inability to reach consensus among
member states, a compromise was reached at two months. (note: this refers to the specific type of leave called parental leave, under EU law there are different types of leave, such as maternity leave, paternity leave, parental leave, and carer leave which are regulated differently).
Length of leave In 2013, Joseph, Pailhé, Recotillet, and Solaz published a
natural experiment evaluating a 2004 policy change in France. They were interested in the economic effects of full-time, short paid parental leave. Before the reform, women had a mandatory two-month parental leave, and could take up to three years' unpaid parental leave with their job guaranteed, though most women only took the two months. The new policy, ''complément libre choix d'activité'' (CLCA), guarantees six months of paid parental leave. The authors found positive effects on employment: compared to women in otherwise similar circumstances before the reform, first-time mothers who took the paid leave after the reform were more likely to be employed after their leave, and less likely to stay out of the labor force. The authors point to similar results of full-time, short paid parental leave observed in Canada in 2008 by Baker and Milligan, and in Germany in 2009 by Kluve and Tamm. However, Joseph also found that wages were lower (relative to women before the reform) for moderately and highly educated women after the leave, which could be because the women returned to work part-time or because of a "motherhood penalty", where employers discriminate against mothers, taking the six-month leave as a "signal" that the woman will not be as good of an employee because of her mothering responsibilities. Rasmussen analyzed a similar
natural experiment in Denmark with a policy change in 1984 where parental leave increased from 14 to 20 weeks. Rasmussen found the increased length of parental leave had no negative effect on women's wages or employment and in the short run (i.e., 12 months) it had a positive effect on women's wages, compared to the shorter leave. There was no difference on children's long-term educational outcomes before and after the policy change.
On health and development According to a 2020 study, parental leave leads to better health outcomes for children. A Harvard report cited research showing paid maternity leave "facilitates breastfeeding and reduces risk of infection" Data from 16 European countries during the period 1969–1994 revealed that the decrease of infant mortality rates varied based on length of leave. A 10-week leave was associated with a 1–2% decrease; a 20-week leave with 2–4%; and 30 weeks with 7–9%. The United States, which does not have a paid parental leave law, ranked 56th in the world in 2014 in terms of infant mortality rates, with 6.17 deaths per every 1,000 children born. The research did not find any infant health benefits in countries with unpaid parental leave. Paid leave, particularly when available prior to childbirth, had a significant effect on birth weight. The frequency of low birth rate decreases under these policies, which likely contributes to the decrease in infant mortality rates as low birth weight is strongly correlated with infant death. However, careful analysis reveals that increased birth weight is not the sole reason for the decreased mortality rate. A 2021 study found that the introduction of paid maternity leave in Norway substantially improved maternal health outcomes, in particular for first-time and low-income mothers. Children whose mothers worked in the first 9 months were found to be less ready for school at the age of 3 years. The effects of mothers' employment appeared to be the most detrimental when employment started between the sixth and ninth month of life. The reasons for this were uncertain, but there is conjecture that there was something unusual for the group of mothers who returned to work in this time period as they represented only 5% of all families studied. Negative impacts in terms of school-readiness were most pronounced when the mother worked at least 30 hours per week. These findings were complicated by many factors, including race, poverty, and how sensitive the mother was considered. The effects were also greater in boys, which is explained by the fact that many analysts consider boys more vulnerable to stress in early life. The same Harvard report also linked paid parental leave and a child's psychological health. It found that parents with paid parental leave had closer bonds with their children. In recent years, various OECD countries drew attention to the topic, especially to the time of the parental leave taken by fathers, and concluded that short-term paternal leaves still lead to positive outcomes for the child's development. Families do take into account relative income levels of each parent when planning for parental leave; the partner earning a lower wage may be more likely to take parental leave. There is also often workplace pressure on men not to take paternity leave, or to take less than the maximum time allowed. To counteract these pressures and encourage paternity leave, some countries have experimented with making paternity leave mandatory or otherwise incentivizing it. Studies looking for a connection between paid parental leave have shown conflicting results. Some research looked at women 25–34 years old, who are more likely to be affected by leave legislation. Fertility rates peaked for those between 25–29 and 30–34 across European countries. A study of a 2012 law in Sweden that allowed fathers to take up to 30 days of paid family leave in the first year after the birth of the child at the same time as the mother was on leave led to substantial improvements in the mental and physical health of mothers.
On freedoms and opportunities According
Amartya Sen and
Martha Nussbaum universal, paid parental leave enables the freedom and opportunity of starting a family while also working.
On gender equality Parental leave policies have an impact on
gender equality as it relates to
parenting and are therefore used by various countries as a tool to promote gender equality. Many countries have implemented paid parental leave policies for both parents, while a minority of countries, like the United States, only have unpaid parental leave. A father's quota, which reserves a part of the leave period exclusively for the father, is sometimes assumed to promote gender equality, although the extent and effects are subject to debate. Moreover, when discussing parental leave policies, the focus is often on comparing improvements in maternity leave policies to what was available in the past, rather than comparing the impact of diverse policies around the world that distribute parental leave differently between both parents. Statistics show a positive correlation between maternity leave policies and women's employment, but the causation relationship cannot be firmly established. Economist Christopher Ruhm argues that men's involvement in childcare at the same level as women is essential for eliminating differences in gender roles. Thus, an increase in the use of parental leave by women (and lack thereof by men) will have a negative impact on gender equality. Inversely, an increase in the use of leave by men will have a positive impact. The
Norwegian Association for Women's Rights, summarizing different studies, states that there is only limited evidence to support a relationship between the father's quota and gender equality; the few relevant studies point in different directions; the association's former president, psychologist and former chairman of UNICEF
Torild Skard, argues that psychological research does not support the assertion that mothers can be replaced by fathers in the first year. A Norwegian study from 2018 found that an extension of the father's quota had no effect on gender equality. Through examination of leave policies in twenty-one European countries by describing the existing policy schemes' duration, payment, and transferability, Carmen Castro-Garcia created the Parental Leave Equality Index (PLEI), which can predict the participation of each parent in raising their children based on their gender and the existing policy regarding parental leave. In 2014, the
European Parliament concluded that, by promoting the uptake of parental leave and paternity leave by fathers, governments can aim to facilitate a more gender-equal distribution of care work, support mothers' return to the labor market, equalize the circumstances in which women and men enter the labor market, Findings by the European Parliament in 2015 found that 18 of the EU-28 countries offer paternity leave, and that the EU-average length is 12.5 days, ranging from one day in Italy to 64 working days in Slovenia. For 23 EU member states, on average only 10 percent of fathers take parental leave, ranging from 0.02 percent in Greece to 44 per cent in Sweden. The gender difference in the employment rate is representative of the gender employment gap; filling this gap is an important objective in promoting gender equality and is a part of the
Europe 2020 target of an employment rate of 75 per cent for both men and women. The uptake of leave by fathers can reduce the motherhood penalty by enabling mothers to return to the labor market, as illustrated by studies that have shown that the involvement of fathers in childcare has a positive effect on mothers' full-time employment. Reduction of the
gender pay gap (GPG) is also an important goal for the EU. In 2014 the GPG in the EU-28 was 16.1 percent, which means that for every euro men got paid in the EU, women got paid 83.9 cents. (The GPG exists equally after correction for occupation and education level. Increased leave uptake by fathers can reduce the length of career interruptions for women, reduce part-time work by women and potentially reduce the GPG, all of which are leading causes of the gender pension gap. In Sweden, 90 days cannot be transferred from one parent to the other—i.e. each parent gets at least 90 days of parental leave, thus the quota applies equally to both parents and is not specifically fathers. The only Nordic country that does not provide fathers with a quota is Denmark, where women have the right to four weeks parent leave before giving birth and 14 weeks leave after giving birth. Thereafter, 32 weeks of parent leave are voluntarily divided between the man and the woman, making eight months leave entirely up to the family to decide. However, the dual earner/dual care model seems to be the direction of all the Nordic countries are moving in the construction of their parental leave systems. A study done in Norway found that when parental leave is granted for both parents, there is still gender inequality observed in the form of mothers being more likely to have part-time jobs compared to their partners.
Germany In Germany, original laws tackling gender inequality with respect to parenting date back to 1986 in both
Eastern and
Western Germany, where one parent could take up to two years of leave after the birth of the child with a maximum allowance. According to a study done in 2006, 97% of the people who took the leave were mothers. In 2007, declining
birth rates and demographic change led to a new law, the "Parenting Benefits and Parental Leave Law" (Bundeselterngeld- und Elternzeit-Gesetz). The law's impact was mainly perceived positively with men reporting high motivation to take leave. So far this has not been reflected in official statistics, but Susanne Vogl concludes that if there is a general willingness of men to participate in parental leave the new Parenting Benefits regulations will help facilitate the actual decision to take a leave. however, certain states have passed laws providing paid workers with such rights. As of April 2022, ten states (California,
New Jersey,
Rhode Island, New York,
Washington,
Massachusetts,
Connecticut,
Oregon,
Colorado, and
Maryland) and the
District of Columbia have enacted laws that grant parental leave as part of state paid family and medical leave insurance laws, with 4 being effective currently. In states without such laws, a proportion of companies do provide paid parental leave. The group of mothers that uses maternity leave most often in the United States are White, non-Hispanic women and the usage of paid maternity leave is drastically lower among
Black and
Hispanic mothers. The groups of women that have the most access and opportunity to use maternity leave are often reported as having a higher level of income and full-time employment. Black people are substantially less likely to take maternity or parental leave, which is due to structural factors including racial and ethnic discrimination in the workforce. Black parents are frequently employed in the public sector, which also may exclude them from paid family leave opportunities. Michael Bittman stated that the reason they provide parental leave is unique in that they view children as "
public goods" and, therefore, the state is responsible to provide and support the child.
China According to a study done by Nan Jia, during the
Maoist era, women's full participation in the labor force played a key role in the Chinese government's efforts to advance women's position in society. To facilitate women's labor force participation, the Chinese government initiated a series of measures to mitigate the work–family conflict that women face during pregnancy and childbirth. In the post-reform era, a series of new regulations have been introduced to protect women's employment and reproductive rights in the new market economy. The
Labor Law adopted in 1995 ensured that women and men have equal employment rights and that employers will not lay off women employees or lower their wages for reasons of marriage, pregnancy, maternity leave, or breastfeeding. The Labor Contract Law enacted in 2008 introduced the provision that prohibits employers from unilaterally terminating labor contracts with women employees who are pregnant, give birth, and care for a baby postpartum. Thus, under the Labor Law and Labor Contract Law, women employees are entitled to job-protected maternity leave. The post-reform era saw further improvements in maternity benefits. The length of paid maternity leave was extended from 56 days prior to reform, to 90 days in 1988, and to 98 days in 2012. Most recently in 2016, paid maternity leave was extended to a minimum of 128 days after the long-standing one-child policy was replaced with a policy that encourages each couple to have two children. This latest extension of paid leave aims to increase fertility rates and slow the population aging process. == Private parental leave ==