Working Paper: CEPR ID: DP16418
Authors: Rafael Lalive
Abstract: In July 2005, Switzerland introduced the first federal paid maternity leave mandate, offering 14 weeks of leave with 80% of pre-birth earnings. We study the mandate's impact on women's employment and earnings around the birth of their first child, as well as on their subsequent fertility by exploiting unique, rich administrative data in a difference-in-differences set-up. Women covered by the mandate worked and earned more during pregnancy, and also had temporarily increased job continuity with their pre-birth employer after birth. Estimated effects on other labor market outcomes are small or absent, and all dissipate by five years after birth. The mandate instead persistently increased subsequent fertility: affected women were three percentage points more likely to have a second child in the next nine years. Women living in regions that had greater early child care availability experienced a larger increase in subsequent fertility following the mandate, suggesting that child care complements paid maternity leave in helping women balance work and family.
Keywords: female labor supply; maternity leave; return to work; earnings; fertility
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Federal maternity leave mandate (J22) | Increased labor supply before birth (J19) |
| Federal maternity leave mandate (J22) | Increased earnings during pregnancy (J39) |
| Federal maternity leave mandate (J22) | Temporary increase in job continuity with pre-birth employer (J63) |
| Federal maternity leave mandate (J22) | Enhanced job stability for mothers (J12) |
| Federal maternity leave mandate (J22) | Increased likelihood of having a second child (J13) |
| Child care availability (J13) | Increased likelihood of having a second child (J13) |
| Federal maternity leave mandate (J22) | Diminished long-term labor market outcomes (J79) |