Parental leave and mothers' careers: The relative importance of job protection and cash benefits

Rafael Lalive; Analía Schlosser; Andreas Steinhauer; Josef Zweimüller

doi:10.1093/restud/rdt028

Parental leave and mothers' careers: The relative importance of job protection and cash benefits

Rafael Lalive, Analía Schlosser, Andreas Steinhauer, Josef Zweimüller

School of Economics

Research output: Contribution to journal › Article › peer-review

Abstract

Job protection and cash benefits are key elements of parental leave (PL) systems. We study how these two policy instruments affect return-to-work and medium-run labour market outcomes of mothers of newborn children.Analysing a series of majorPLpolicy changes inAustria,wefind that longer cash benefits lead to a significant delay in return-to-work, particularly so in the period that is job-protected. Prolonged parental leave absence induced by these policy changes does not appear to hurt mothers' labour market outcomes in the medium run.We build a non-stationary model of job search after childbirth to isolate the role of the two policy instruments. The model matches return-to-work and return to same employer profiles under the various factual policy configurations. Counterfactual policy simulations indicate that a system that combines cash with protection dominates other systems in generating time for care immediately after birth while maintaining mothers' medium-run labour market attachment.

Original language	English
Article number	rdt028
Pages (from-to)	219-265
Number of pages	47
Journal	Review of Economic Studies
Volume	81
Issue number	1
DOIs	https://doi.org/10.1093/restud/rdt028
State	Published - Jan 2014

Keywords

Earnings
Family and work obligations
Family earnings gap
Labour supply
Parental leave
Return-to-work

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10.1093/restud/rdt028

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title = "Parental leave and mothers' careers: The relative importance of job protection and cash benefits",

abstract = "Job protection and cash benefits are key elements of parental leave (PL) systems. We study how these two policy instruments affect return-to-work and medium-run labour market outcomes of mothers of newborn children.Analysing a series of majorPLpolicy changes inAustria,wefind that longer cash benefits lead to a significant delay in return-to-work, particularly so in the period that is job-protected. Prolonged parental leave absence induced by these policy changes does not appear to hurt mothers' labour market outcomes in the medium run.We build a non-stationary model of job search after childbirth to isolate the role of the two policy instruments. The model matches return-to-work and return to same employer profiles under the various factual policy configurations. Counterfactual policy simulations indicate that a system that combines cash with protection dominates other systems in generating time for care immediately after birth while maintaining mothers' medium-run labour market attachment.",

keywords = "Earnings, Family and work obligations, Family earnings gap, Labour supply, Parental leave, Return-to-work",

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note = "Funding Information: Parental leave (PL) regulations are a central element of family policies in most OECD countries. They help new parents in two complementary ways: by guaranteeing the pre-birth job and by offering financial support. A first main goal of PL mandates is to increase women{\textquoteright}s employment and earnings in the medium run by encouraging job continuity after birth. Yet, prolonged periods of absence from the workplace might lead to loss of human capital and weaker labour market prospects after returning to work. Hence previous employers, while obliged to re-employ mothers",

year = "2014",

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doi = "10.1093/restud/rdt028",

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Parental leave and mothers' careers: The relative importance of job protection and cash benefits

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Keywords

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