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The short- and long-term effects of family-friendly policies on mothers' employment

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De Quinto, Alicia ; González, Libertad

Institute of Labor Economics, Bonn

IZA - Bonn

2024

55 p.

reduction of working time ; maternity ; child care ; working mother ; employment security

Spain

Discussion Paper

17509

Gender equality & Women

https://docs.iza.org/dp17509.pdf

English

Bibliogr.

"Countries often encourage part-time work among new parents as part of their family policies, aiming to foster mothers' labor market attachment. However, this approach may unintentionally impede women's long-term career prospects. We examine the impact of a 1999 Spanish reform that allowed parents to reduce their working hours by up to a half while their youngest child was under age 6, along with job protection measures. Leveraging eligibility rules, we follow a regression kink design, comparing ineligible women to mothers who had varying lengths of eligibility, and tracking their subsequent work trajectories. Our findings show that longer eligibility led to a modest increase in maternal part-time work during her child's early years, with mothers working approximately one additional day part-time for each extra month of eligibility. This increase in part-time work substituted for days spent in unemployment rather than reducing full-time work, leading to a rise in earnings. In the long term, extended eligibility also led to improvements in both employment and earnings. Overall, we find that the policy had a positive impact on the labor supply and earnings of women with children, both in the short and long term."

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