Paid Leave: Not a Joke

Here’s a joke: a Republican, a Democrat, the director of a left-wing think tank, three AEI scholars, and Ivanka Trump walk into a bar. What do they agree on?

The answer: they want federally mandated paid leave or child care, effective immediately.

You aren’t laughing? Well, you’re in good company–this joke isn’t funny, especially for women. Paid leave and child care policies have been tried in a variety of contexts, and to advocates’ dismay, the consequences are not universally beneficial to women.

As an example, take Chile, which in 2009 mandated employer-provided childcare for working moms. According to recent research, women employed by affected Chilean firms were paid between 9 and 20 percent lower wages than comparable female Chilean workers following policy implementation.

And the impact of women’s labor policies is arguably worse in Spain, which is struggling with the fallout of a 1999 policy that aims to protect women with children against layoffs [1] but in practice harms them: a natural experiment shows that after policy implementation, Spanish employers were less likely to hire childbearing-aged women, less likely to promote child-bearing-aged women, and more likely to lay child-bearing-aged women off.

Although Spain and especially Chile are different in myriad ways that limit extrapolation to a U.S. context, it’s hard to dismiss home-grown evidence. Though the United States doesn’t have a federally-mandated paid leave policy, it did enact a federally mandated unpaid leave policy, Family & Medical Leave Act (FMLA), in 1993. And despite FMLA being an accepted part of the modern legislative fabric, the consequences of the policy are not all stellar. Analysis suggests women hired after the policy are five percent more likely to be employed but eight percent less likely to be promoted.

Though the U.S. hasn’t adopted a paid leave mandate, a few states have. Research on policy outcomes in California show female labor force participation rising after implementation of paid leave (maybe good?) and childbearing-aged female unemployment and unemployment duration rising, too (unambiguously bad). This is probably because the mandate made women universally more expensive in employer’s eyes, whether professional women intend to use benefits or not.

So why don’t the Ivankas of the world seem to care about these negative repercussions, at least as much as the imagined benefits of women’s policies? The most gracious interpretation is that modern advocates are uninformed. It could also be that it is inconvenient information.

And although advocates would like to paint a rosy picture, the reality is that some women, perhaps many, would be collateral damage under a federally mandated policy. For negatively affected women, that’s a lot more tragic than it is funny.


[1] This protection is granted if the worker had previously asked for a work-week reduction due to family responsibilities.