A new report from the Center for American Progress makes the case for policies requiring employers to offer paid sick leave and paid family and medical leave by looking at the impact these policies have had on unemployment in US jurisdictions that have implemented them in recent years. The study finds that neither type of mandate results in increased unemployment, and points to existing research to argue that such policies are in fact beneficial to businesses and the economy.
Looking at 19 states and cities that passed paid sick leave mandates between 2007 and 2015, CAP found that unemployment had fallen one year after the law was implemented in 16 of these localities, while in two of the three places where unemployment rose, the law coincided with the onset of the 2008 recession, and in the third—Bloomfield, New Jersey—the increase was slight. The researchers also cite several other studies from the US and around the world showing that the economic effects of mandating paid sick leave are either positive or neutral, such as a survey of employers published last September, which showed that New York City’s mandate had little impact on business costs, hiring, or productivity. Other research supports paid sick leave from a public health perspective, showing that it reduces presenteeism and prevents the spread of contagious illnesses in the workplace.
The number of localities with these mandates is increasing: Most recently, Arizona and Washington state both voted in November to introduce them.
As for family and medical leave, the CAP report looks at the three states—California, New Jersey, and Rhode Island—where mandates have already been implemented, and finds that unemployment did not rise in the year following implementation in any of these states. Other jurisdictions have passed similar laws but not yet implemented them, including New York State, Washington State, San Francisco, and Washington, DC. In their review of existing research, the authors cite several studies showing that these mandates tend to have a positive impact on women’s labor force participation and wages, while businesses that offer these benefits see greater productivity and lower turnover.
The United States is the only industrialized economy in the world that does not mandate paid maternity or parental leave at the national level, but momentum has been building behind an effort to enact a federal mandate, and the issue was on the table in November’s presidential election, with president-elect Donald Trump advocating a modest federal guarantee of six weeks of leave for birth mothers only, paid for through the federal unemployment insurance program. As in other regards, the prevailing political climate indicates that regulation is likely to move farther and faster at the state and local levels, however, and large employers like Ikea and American Express are making moves of their own to expand parental leave.