The impact of paid leave on the incidence of leave-taking among new mothers: An analysis of New Jersey's paid family leave insurance program

Very few women in the United States have access to family leave, and even fewer have access to leave that is paid. This is problematic given the high rates of labor force participation among women and the recent rise in the number of single-parent households, as well as the myriad of potential health and economic benefits that family leave provides to women and their children. While the United States has a federal leave policy, it is neither paid nor universal, and while many states have laws that extend the coverage and/or generosity of the federal benefit, most of these are unpaid as well. Survey data indicate that these policies have expanded coverage, however, prior research is inconclusive as to the effect of leave policies on the actual incidence of leave-taking among women. Furthermore, there has been very little research to date on the effect of paid family leave policies in the United States, mainly because these policies are relatively new. This study is the first to examine the effect of New Jersey's recently implemented Family Leave Insurance program - the second state-level policy in the country to provide partially paid family leave - on leave-taking behavior. Specifically, the study primarily examines the policy's effect on the incidence of leave-taking among employed women in the state. It also explores the effect of other factors that may influence a woman's decision to take leave following childbirth on the probability that she takes leave, including financial and non-financial concerns, her employment characteristics, the number of other children she has, and her demographic characteristics. The analysis uses March Current Population Survey data from 2007 to 2009 and 2011 to 2012 and a difference-in-difference methodology to determine the effect of the policy, using women with children under age one as the treatment group and several different control groups, including women with children under age one in other states, women with older children, women without children, and women aged forty-five and older. The study finds suggestive evidence that New Jersey's Family Leave Insurance policy has increased the incidence of leave-taking in the state.