Is there such a thing as too much parental leave?

Decades ago, I might have been sacked for being pregnant, or seen my pay crash to zero after giving birth. These days (mostly through the FT) I get job protection, a generous chunk of maternity leave at full pay and even a coach to ease my return to work. In general I am in favour of policies to support those of us who nobly breed future taxpayers. But is it possible to go too far?
At first, the point of parental leave was to protect the health of mother and baby. Childbirth warrants some recovery time, and though communication isn’t my toddler’s strong suit, I think he appreciated the home rest too. More recently, expanded benefits for parents have been seen as a way to promote gender equality or even boost the birth rate. By pulling men on to more nappy duty, paternity leave could even out the load of child rearing.
Sadly, the unintended consequences are easy to imagine. Extended maternity leave could detach mothers from paid work. Generous benefits could make managers hesitant about hiring potential parents. Exposing more fathers to the realities of full-time childcare could even turn some of them off the pursuit.
Helpfully, governments have provided economists with plenty of reforms to evaluate. And at least some parental leave has lots of nice effects, from health benefits for mother and child to greater involvement of fathers in family life.
But at least when it comes to maternity leave, the economic benefits do seem to have a limit. One review found that although leave of up to around six months improves mothers’ chances of returning to paid work, more than about a year has the opposite effect. When in the 1980s and 1990s the French and German governments expanded it beyond that point, paid employment and wages for mothers suffered.
There is also some awkward evidence of benefits at least partly backfiring. One working paper by Jenna Stearns of the University of California, Davis found that in Britain expanding the period of job protection to a year lowered the chances of being promoted or holding a managerial role. Another found that in Germany more generous maternity benefits meant small companies hired fewer women of childbearing age into roles that were tricky to cover.
Paternity leave is no more straightforward. A new working paper finds, for example, that men taking long stints are penalised when applying for jobs in male-dominated sectors. Another study found that in Norway, making paternity leave more generous lowered men’s earnings by 1-3 per cent. They argued that this was because of a “rat race”, whereby one father taking time out opened up space for colleagues to get ahead. (The authors’ fix is for all fathers to use their allotted leave.)
Other alarming studies include one examining a Swedish reform that reserved a month of paid parental leave for fathers, which found that it raised the chances of divorce by around one percentage point. Admittedly, a later reform that increased paternity leave without reducing the amount available to mums had no such effect.
The first finding could be because mothers responded by taking more unpaid leave, increasing financial stress on the relationship. (Other research has also found that paternity leave can lower the chances of parents separating.)
The effects of expanded paternity leave on fertility are also a little complicated.
A study of a Spanish reform found that just two weeks of paternity leave increased the time between having children, while in Belgium researchers found a similar effect among younger mothers. The authors of the Spanish study reckon there are two mechanisms at play: men waking up to the realities of caring for a newborn full-time; and women enjoying improved career prospects, pushing back further procreation.
Of course, the presence of unintended consequences does not justify the very stingy national policies that many Americans and Brits have to rely upon.
America’s federal floor for parental benefits is embarrassingly absent, while in Britain the minimum is 90 per cent of pay for six weeks, then at most £184 per week for 33 more weeks.
My memories of the period after my son was born are hazy, but I think I spent about that much on nappies and wipes alone. As I am now going on maternity leave for a second time, I am looking forward to the opportunity for a refresher – and grateful that the FT’s policy is more generous. – Copyright The Financial Times Limited 2024