Employers in the US are cutting back on parental leave, survey shows

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Simon Read, Senior Writer, Formative Content

• Fewer employers in the United States are offering paid maternity and paternity leave, according to a survey.
• Organizations increased parental leave entitlements during the pandemic, but now appear to be scaling back.
• Parental leave can promote equality and allows organizations to retain workers, research shows.
• There is evidence paternity leave has wider economic benefits.

Employers in the US appear to be cutting back on paid maternity and paternity leave.

The amount of time off granted to new parents is returning to pre-pandemic levels, according to the survey from the Society for Human Resource Management (SHRM).

That’s despite evidence maternity and paternity leave can support gender equality and bring economic benefits.

Leave for parents who foster or adopt is scaled back, too

The number of organizations offering paid maternity leave dropped to 35% in 2022, down from 53% in 2020, says the study.

Fewer employers are granting paid paternity leave too, down from 44% to 27%.

Paid leave for parents who adopt or foster is also becoming rarer. Just 28% of employers offer paid adoption leave: in 2020, 36% of organizations did so.

Leave is among top-rated workplace benefits

New foster parents get paid leave from 22% of organizations now, down from 28%.

Those cuts are being made despite employers ranking leave as among the top benefits organizations should offer their workers, as shown in the chart below.

SHRM researcher Derrick Scheetz says benefits for new parents improved in 2020 in response to the pandemic, but “now that many businesses have returned to a more typical way of operating, employers seem to be dialling back on expanded parental-leave opportunities”.

Bosses may be less committed to offering paid parental leave because employees are more able to work from home – but that may “overlook the need for parental bonding time with new children,” SHRM says.

Women are losing maternity benefits at a time when gender inequality in the workforce is an “emerging crisis”, according to the World Economic Forum’s Global Gender Gap Report 2022.

Paternity leave can help organizations as well as families

The gender gap in the labour market has been steadily widening since 2009, but disparity has worsened significantly since 2020, says the report.

There could be big downsides to cutting back on paternity leave, too, it says.

Employers who do so might miss out on the benefits paternity leave can bring to organizations as well as families.

Research by McKinsey suggests that on top of improving personal wellbeing at home, paternity leave gives fathers a boost at work.

US fathers take less time off than Europeans

Men who took leave reported feeling more motivated, and said they were considering staying longer with the same employer.

“I see it as an investment in employees,” one father told the McKinsey researchers. “Because of that, I really do respect the bank I work at – it’s really human-oriented.”

Despite that, fathers in the US take an average of just one week of paternity leave, according to research from jobs website Zippia. In the European Union, fathers are entitled to an average of 6.3 weeks of paid leave.

A fifth of men said the biggest disadvantage of taking paternity leave was the risk it could damage their careers, the research suggests.

While most parental leave is taken by women, some countries specify a share which must be taken by the father.

Earmarking paternity leave in this way leads to a 10.8% increase in life satisfaction scores, according to a study in Sweden.

Mothers seemed to benefit more than fathers, even though the policy meant more leave was taken by the dads. The research showed the mothers’ life satisfaction increased 30% more than the fathers.

Increasing working hours

Another benefit of paid paternity leave could be additional economic growth.

That’s because it increases the hours couples can work while they have young children, according to The Guardian.

It cites evidence that paid paternity allows mothers to return to the workplace sooner. If it leads to housework being shared more fairly, that makes couples happier to spend more time at work.

More firms offer mental healthcare

While US parents are losing some of the paternity and maternity entitlements they gained in the pandemic, other benefits are becoming more common.

Over 90% of employers now provide telehealth care or telemedicine as a benefit – up by 20 percentage points on 2019, according to the SHRM research.

Businesses are more likely to offer mental health coverage since the pandemic too, with 91% now providing those benefits.

SHRM researchers say future recruits may now expect employers to offer these benefits.

Working from home is another legacy of the pandemic which looks as if it might be here to stay.

Almost two-thirds of employers told researchers they offer most of their staff a mix of remote and in-person working, and most help with the cost of office equipment at home.