Working Paper: NBER ID: w26832
Authors: Johanna Catherine Maclean; Stefan Pichler; Nicolas R. Ziebarth
Abstract: Using the National Compensation Survey from 2009 to 2022 and difference-in-differences methods, we find that state-level sick pay mandates are effective in broadening access for U.S. workers. Increases in coverage reach 30ppt from a 63% baseline five years post-mandate. Mandates have more bite in jobs with low pre-mandate coverage. Further, mandates reduce inequality in access to paid sick leave substantially, both across and within firms. Covid-19 reinforced existing positive trends in coverage and take-up. Sick leave use increases linearly, whereas costs plateau after five years. Finally, we find crowding-in of non-mandated benefits which we label “job upscaling” by firms to differentiate jobs and attract labor.
Keywords: sick pay; labor economics; social insurance; public policy
JEL Codes: I12; I13; I18; J22; J28; J32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| state-level sick pay mandates (J65) | coverage rates (G22) |
| state-level sick pay mandates (J65) | sick leave utilization (J22) |
| state-level sick pay mandates (J65) | sick leave costs per hour worked (J22) |
| sick leave costs per hour worked (J22) | cost increase for marginal employers (J39) |
| state-level sick pay mandates (J65) | non-mandated fringe benefits (J32) |