Societal and Economic Impacts of Paid Family Leave

During the past several decades, paid family leave has emerged as a policy issue at the intersection of work and life, which is affecting many working families, particularly during the period of childbirth. According to U.S. Census Bureau data, 56 percent of women worked full-time during pregnancy from 2006 to 2008, and among women who worked during pregnancy, 64 percent were actively working less than one month before childbirth and 59 percent returned to work less than three months after childbirth. As the number of single parent households and the number of women participating in the labor force increased over the last three decades, the demand for paid family leave from employers or government has grown. Researchers have found that paid family leave has a number of health and economic benefits. This dissertation builds upon on an existing body of research by examining whether paid family leave improves two measures related to quality of life: child health and mothers’ employment and work schedules. Further, this study examines a potential political precursor to the passage of paid family leave laws, namely the proportion of female legislative representation. Together, these studies enhance our understanding of how paid family leave affects the well-being of working families and the factors that predict its passage into law. One of the unique aspects of this research is that is that the effects of paid paternity leave are examined, which has not received adequate attention in the existing literature. The overarching theme and motivation of this dissertation is the availability of paid family leave and is introduced in Chapter 1. Chapter 2 examines the effects of the availability of paid family leave on the health outcomes of children. This study uses country-level balanced panel data from the 35 OECD countries from 1990 to 2016. Using an event study design, the study finds an approximately 1.9 to 5.2 percent decrease in country-level infant, neonatal, and under-five mortality rates following the adoption of paid maternity leave. However, the impact of the implementation of paid paternity leave was not as apparent as that of paid maternity leave, which may be attributed to its recency and amount that is much smaller than that of the more common maternity leave. An increase in the length of paid paternity leave was found to have a measurable impact on the health outcomes of children. An important finding of this study is that it takes at least two years for paid family leave to have an effect on the health outcomes of children, indicating that there is a delayed impact after the enactment of paid family leave legislation.Chapter 3 examines the impact of the paid family leave on female labor market outcomes, including being employed, working full-time, number of hours worked, and whether mothers actually utilized the paid family leave program. The study uses individual-level, cross-sectional data in the United States from the 2000 to 2019 waves of the Current Population Survey’s Annual Social and Economic Supplement (ASEC) and a triple difference-in-difference estimator. The results show that the adoption of state paid family leave improves the labor market outcomes for mothers with an infant. Mothers with infants in states with paid family leave are 0.6 percent more likely to be employed, 0.6 percent more likely to work full-time, and work 0.8 more hours compared to mothers with infants in states without paid family leave. However, the results also show that the adoption of state paid family leave decreases the labor market outcomes for mothers with both an infant and child. When mothers with both an infant and a child live in states with paid family leave, they are 3 percent less likely to be employed, 2.2 percent less likely to work full-time, and work 1.3 fewer hours compared to mothers with both an infant and a child in states without paid family leave. This may suggest that paid family leave is inadvertently worsening the labor market outcomes for mothers with multiple children. From the results on the utilization of paid family leave, it appears that some mothers may be hesitant to use such leave, which may be attributed to fears associated with taking paid family leave.Chapter 4 examines whether the female legislative representation has a measurable effect on the likelihood of whether a U.S. state adopts friendly work-family policies. The study examines 50 U.S. states from 2000 to 2016 using a linear probability model with data from the Michigan State University’s Correlates of State Policy Project. The study finds that when states have more than 25 percent females in the state legislature and the governor is a female, they do not experience a statistically significant increase in the likelihood of passing friendly work-family laws. The results may suggest that an increase in the passive representation of women does not always result in active representation. According to representation theories in the literature, passive representation leading to active representation only occurs when three conditions are met: 1) the policy area needs to be salient for women; 2) women need to be the direct beneficiary of the policy; and 3) policy area needs to be gender-related. Two of these three conditions were not met in this study, which may explain the null findings. Another explanation is the extremely partisan political culture in the United States where even women-related issues are supported or opposed on party lines, regardless of the number of female legislators in any party.A number of common and interrelated policy implications emerge from the studies included in chapters 2 through 4, which are presented in Chapter 5, Summary and Conclusion. The lagged impact of paid family leave suggests that both the employees and employers need to be educated with the availability of and access to paid family leave and both should be aware of their rights and responsibilities. Compliance of the employers with paid family leave has been an issue with the Family and Medical Leave Act (FMLA), which is on a non-paid basis, and it can be expected to be even worse for paid family leave. Thus, the government would need to come up with better and effective enforcement mechanisms. Fears associated with the utilization of paid family leave, which include impediment to career advancement or even losing job, would need to be mitigated in order to realize the benefits of paid family leave. Finally, the lack of a linkage between female legislative representation and the adoption of friendly work-family legislation may indicate that merely large female legislative representation is not sufficient and the success of such legislation may depend on the buy-in of the public. It needs to be better communicated that paid family leave is beneficial to both employees and employer alike, and paid family leave is a value proposition to businesses and employers.Overall, the findings of this research can be used to educate stakeholders on the need, justification, challenges, benefits, and a general framework for the development and implementation of paid family leave.