The effect of parental leave on female employment: evidence from state policies

Abstract

This paper analyzes the effect of federal and state maternity leave policies on female employment. We analyze if the enactment of the federal Family Medical Leave Act (FMLA) differentially affected states that previously implemented maternity leave laws than those states which did not. Additionally, we study whether FMLA caused an increase in the female employment and labor force participation in those states that expanded its benefits and relaxed the eligibility criteria. Finally, we analyze the Paid Family Leave program in California, comparing how the change in female employment and labor force participation differs from those states which have FMLA alone and those which have complemented the benefits of FMLA. Using March CPS data available from the Integrated Public Use Micro data Series (IPUMS), our results suggest, first, a positive and significant effect of FMLA on female employment and, second, a positive and significant effect on the change in female employment for some of the states that expanded the benefits and eligibility criteria of FMLA.Family Medical Leave Act, Temporary Disability Insurance, Female Employment