Young Children and Parents' Labor Supply during COVID-19

We study the COVID-19 pandemic’s effects on the labor supply of parents with young children. Using the monthly Current Population Survey, and following a pre-analysis plan, we use three variations of difference-in-differences to compare workers with childcare needs to those without. The first compares parents with young children and those without young children, while the second and third rely on the presence of someone who could provide childcare in the household: a teenager in one and a grandparent in the other. We analyze three outcomes: whether parents were “at work” (not sick, on vacation, or otherwise away from his or her job); whether they were employed; and hours worked. Contrary to expectation, we find the labor supply of parents with young children was not negatively affected by the COVID-19 pandemic. Instead, some evidence suggests they were more likely to be working after the pandemic unfolded. For the outcomes of being at work and employed, our results are not systematically different for men and women, but some findings suggest women with young children worked almost an hour longer per week than those without. These results suggest that factors like employers allowing employees to work at home and informal sources of childcare aided parents in avoiding negative shocks to their labor supply during the pandemic.