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A Firm-Side Perspective on Parental Leave

Author

Listed:
  • Huebener, Mathias

    (Bundesinstitut für Bevölkerungsforschung (BiB))

  • Jessen, Jonas

    (IZA)

  • Kühnle, Daniel

    (University of Duisburg-Essen)

  • Oberfichtner, Michael

    (Institute for Employment Research (IAB), Nuremberg)

Abstract

Motherhood and parental leave interrupt employment relationships, likely imposing costs on firms. We document that mothers who are difficult to replace internally take shorter leave and that their firms hire replacements more often. Introducing more generous parental leave benefits erases the link between mothers' internal replaceability and their leave duration. In firms with few internal substitutes this reduces employment in the short-, but not longer-term. Firms respond by hiring fewer women of childbearing age into occupations where they are difficult to replace internally. Taken together, motherhood and generous parental leave policies burden firms that have few internal substitutes available.

Suggested Citation

  • Huebener, Mathias & Jessen, Jonas & Kühnle, Daniel & Oberfichtner, Michael, 2021. "A Firm-Side Perspective on Parental Leave," IZA Discussion Papers 14478, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp14478
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    Cited by:

    1. Tomlin, Bryan, 2022. "Maternity breaks: Unemployment spells or relevant experience?," Journal of Economic Behavior & Organization, Elsevier, vol. 198(C), pages 673-681.
    2. Bartel, Ann P. & Rossin-Slater, Maya & Ruhm, Christopher J. & Slopen, Meredith & Waldfogel, Jane, 2021. "The Impact of Paid Family Leave on Employers: Evidence from New York," IZA Discussion Papers 14262, Institute of Labor Economics (IZA).
    3. Bana, Sarah & Bedard, Kelly & Rossin-Slater, Maya & Stearns, Jenna, 2023. "Unequal use of social insurance benefits: The role of employers," Journal of Econometrics, Elsevier, vol. 233(2), pages 633-660.
    4. Canaan, Serena & Lassen, Anne Sophie & Rosenbaum, Philip & Steingrimsdottir, Herdis, 2022. "Maternity Leave and Paternity Leave: Evidence on the Economic Impact of Legislative Changes in High Income Countries," IZA Discussion Papers 15129, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    parental leave; worker absences; firm-specific human capital; substitution; statistical discrimination;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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