Working Paper Series
IFAU - Institute for Evaluation of Labour Market and Education Policy
Paid parental leave to immigrants: An obstacle to labor market entrance?
Abstract: This paper evaluates how access to paid parental leave
affects labor market entrance for immigrating mothers with small children.
Paid parental leave together with job protection may increase labor force
participation among women but if it is too generous it may create
incentives to stay out of the labor force. This incentive effect may be
especially true for mothers immigrating to a country where having small
children automatically makes the mothers eligible for the benefit. To
evaluate the differences in the assimilation process for those who have
access to the parental leave benefit and those who do not, Swedish
administration data is used in a difference-in-differences specification to
control for both time in the country and the age of the youngest child. The
results show that labor market entrance is delayed for mothers and that
they are less likely to be a part of the labor force for up to seven years
after theír residence permit if they had access to parental leave benefits
when they came to Sweden. This reduction in the labor force participation
is to some extent driven by unemployment since the effect on employment is
smaller. But there is still an effect on employment of 3 percentage points
lower participation rates 2-6 years after immigration.
Keywords: Immigrant assimilation; labor market entrance; paid parental leave benefit; (follow links to similar papers)
JEL-Codes: J13; J15; J21; (follow links to similar papers)
57 pages, February 1, 2013
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