One of the biggest arguments for paid leave for new parents has been an economic one: Research has repeatedly shown that women with paid time off after childbirth are more likely to keep working.
But a new study, the largest to be done in the United States, found the opposite. In California, which in 2004 became the first state to offer paid family leave, new mothers who took it that year ended up working less and earning less a decade later. They averaged $24,000 in cumulative lost wages, it found.
“I could feel the air going out of the room when we presented this,” said Martha J. Bailey, an economist at the University of Michigan and one of four authors of the working paper. “This is not the way we teach this in economics textbooks.”
Paid leave is gaining in popularity. It has bipartisan support in Congress for the first time, and Gov. Gavin Newsom has proposed expanding California’s leave to six months. So what to make of these new results?
To start, it’s a reminder that even when lots of data point in the same direction, it doesn’t mean the outcome is guaranteed. For policies like paid leave, the way they’re designed and the context in which they’re rolled out matter a lot.
In this case, if the goal is to keep women working, other things seem necessary beyond several weeks of paid leave, researchers said. One would be subsidized child care, for after parents return to work. It could also help if fathers take leave and change their work and family routines alongside women. Countries that give men incentives to take paternity leave have seen more gender equality at work and at home as a result.
“The answer is not, ‘Don’t pass paid leave policies,’” Ms. Bailey said. “I think the answer has to be that we think smarter about how to design those policies, that also encourage fathers to take leave.”
Keeping women in the labor force isn’t the only goal of paid leave policies. Another is enabling parents to spend time with young children — and on that, the paper indicates that California’s policy was a success. Children benefit from breastfeeding, bonding, consistent caregiving and hands-on parental involvement — things that are easier for parents to provide with paid leave.
Seen this way, the authors wrote, “paid leave legislation could be responsible for an increase in investment of $24,000 worth of mothers’ time in children.”
The researchers studied 153,000 women, almost all of the eligible women who gave birth in California in the first and third quarters of 2004, before and after the policy took effect. They followed them for a decade. They used tax data to learn about their employment and earnings, and Social Security data to track their births. They also used Survey of Income and Program Participation data on the time parents spent with their children.
Of all mothers who took paid leave, there was a small negative effect on their employment and earnings compared to those who didn’t take it, which the researchers said was statistically insignificant. For first-time mothers, there was a clear negative effect. After 10 years, the new mothers who took paid leave right after they gave birth were 5 percent to 7 percent less likely to be employed, and those who were employed earned 5 percent to 8 percent less. The researchers said the earnings decreases could be because they worked fewer hours, moved to jobs with lower wages and more flexibility, or became self-employed.
These patterns held no matter the age or prior earnings of the mother, and were true for both unmarried and married mothers, though the decreases in employment were slightly larger for unmarried women, found the paper, which was partly financed by the National Science Foundation.
Other researchers of paid leave — including in California, which gives parents six weeks of bonding leave on top of six weeks of disability leave for birth mothers — have generally found that moderate-length leaves (no more than a year) increase the chance that women keep working.
The new paper is solid and the results plausible, said Maya Rossin-Slater, an economist at Stanford who has researched California’s program extensively.
“They have fantastic data and large sample sizes relative to the prior papers, and that’s a big advance,” she said. “This paper cautions us that paid leave is not a silver bullet. There are other policy tools we need to implement.”
But the results might not be generalizable to all women, she and others said. Despite the large sample, the effects were limited to women who took leave immediately after it became available. Only about a fifth of women who gave birth then did so, and that group might have been more inclined to step back from work in the first place.
A variety of research has found that this group was more likely to be older, high-earning, white and college educated than those who took leave after the program had been in effect for a while. Even later, awareness of the program was low, particularly among low earners — exactly the group that research has shown gets the most economic benefits from paid leave.
The paper’s authors explored other explanations for the unexpected results. Perhaps employers discriminated against women who took leave, nudging them out of their jobs. But even if they treated mothers this way, it is unlikely that they would treat women who took a few weeks of leave a decade earlier differently than other mothers, they said.
Instead, the researchers concluded, something about taking paid leave seems to have encouraged mothers to scale back at work and spend more time with their children.
Mothers who took the leave spent more time than those who didn’t reading to children, sharing meals with them and taking them on outings, the researchers found. They also had fewer children, consistent with the style of intensive parenting that entails investing lots of time and money in each child.
Still, while leaves of a year or more in Europe have been shown to stall women’s careers, women in California took just several weeks off. Could that short a period really influence their career and family decisions for years to come?
If it did, Ms. Bailey said, it could be because the weeks after a baby is born upend a family’s life and create new routines. If the mother — but not the father — is out of work and doing most of the child care at the beginning, the division of labor could get locked in. One piece of evidence for this, she said, is that the effects were bigger for first-time mothers, who were forming their family routines for the first time.
Which brings the story back to men. Just 15 percent of bonding leave claims in California in 2004 were by men, and the average man took just two or three days off. Men’s employment and earnings did not decline after they had a child.
Even if the study complicates the economic argument for paid leave, it makes one thing clear: how much women’s lives changed after taking time off with a new baby — and how little men’s lives did.
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