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New Stevens Research Explores Impact of Paid Family Leave

paid family leave

Often “derided as costly giveaways,” the Stevens Institute of Technology looked deeper into the economic benefits of paid family leave policies, finding a fairly surprising positive effect across the board.

Stevens Associate Industry Professor Dr. Joelle Saad-Lessler and economist Kate Bahn surveyed paid family leave policies in California by looking at SIPP data from 2001, 2004, and 2008, which “gathers information on people who provide regular unpaid care or assistance to a family member or friend who has a long-term illness or a disability.” At 6 weeks of partially paid leave, California remains only one of two states, along with New Jersey, to adopt and implement such a program.

Dr. Saad-Lessler explains that that the only federal policy on the books regarding leave—signed by President Clinton in 1993—stipulates that employees are entitled to 12 weeks’ unpaid leave. But there’s a vocal consensus about the need for access to paid leave, particularly with an increased aging population. “Access to paid leave is a crucial part of the ability to care for one’s own family beyond the immediate need to take time off with a new child,” they say.

Saad-Lessler and Bahn’s research, which was funded by the Center for American Progress, explored how young women’s wages were affected when new mothers and caregivers took leave. The researchers found that labor force participation increased 8 percent in the short term and 14 percent in the long run. While there was a decline in full-time work, as workers took advantage of being able to transition to part-time roles without losing access to paid leave, the notion of a mass workforce exodus “would be a crushing economic blow.”

Dr. Saad-Lessler concludes, “We have hit a threshold where families cannot manage their careers and their caregiving responsibilities without adequate work-life policy, including paid family and medical leave. As our results show, when families do have access, they are able to increase their labor force participation.”

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