“This is Not The Way We Teach This,” read the New York Times headline in response to a new National Bureau of Economic Research (NBER) working paper that reported results from a study of California's paid family and medical leave policy. Contrary to past research that suggested positive work and wage effects of California's policy, this new study found that it decreased new mothers' employment and earnings a decade out.
The study examined the impact of California's 2004 expansion of paid parental leave under the state's Temporary Disability Insurance (TDI) program, from 6 weeks post-birth for mothers to 12 weeks for new mothers and 6 weeks for fathers. The authors analyzed tax data on all California moms who gave birth before the policy change to the time after and found no difference in their employment levels. Mothers who gave birth for the first time and took paid leave experienced reduced employment by 2.4 percent in the first 5 years after birth, and 5.4 percent after 11 years.
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