Parental Leave Duration and Mothers' Skills along the Life Course

Adèle Lemoine, Wittgenstein Centre for Demography and Global Human Capital
Sonja Spitzer, Wittgenstein Centre for Demography and Global Human Capital
Claudia Reiter, Institute for Advanced Studies Vienna

We explore whether career interruptions around childbirth reduce mothers' work-relevant skills -- a mechanism often suggested as part of the motherhood penalty. Using a new policy dataset covering 30 years of parental leave reforms across 18 European countries, we link variation in leave entitlements to test-based numeracy scores in later life. We find that each additional year of parental leave reduces mothers' numeracy skills by four percent. This decline is not driven by fertility responses to the policies. Instead, longer entitlements increase the duration of parental leave in the short run and contribute to more fragmented employment histories in the long run, marked by more career breaks and fewer years in paid work. This suggests that extended leave may decrease mothers' labor market attachment and thus reduce their opportunities to use and maintain work-relevant skills, consistent with the ``use it or lose it'' hypothesis. Ultimately, this lower human capital accumulation across the life course leads to lower earnings later in life; however, the skill losses are too small to explain large parts of the motherhood penalty. Effects are most pronounced among highly educated women in skilled occupations, and in countries with low childcare coverage and long statutory leave.

Keywords: Economic Demography, Gender Dynamics, Human Capital, Education, and Work, Families, Unions and Households

See extended abstract.

  Presented in Session 27. Gender Dynamics and Demographic Shifts Over Time