Showing posts with label family. Show all posts
Showing posts with label family. Show all posts

Parental Leave in Other Countries

Note:  On February 22, 2012, two  comments from readers added at the end of the post.
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The United States has far fewer laws that offer protections to parents with family responsibilities than do most other countries. Alison Earle, Zitha Mokomane, and Jody Heymann discuss "International Perspectives on Work-Family Policies: Lessons from the World’s Most Competitive Economies," in the Fall 2011 issue of the Future of Children. Indeed, the issue is devoted to issues of "Work and Family." From the "Summary" of the Earle, Mokomane, and Heymann article:


"The United States does not guarantee families a wide range of supportive workplace policies such as paid maternity and paternity leave or paid leave to care for sick children. ... Using indicators of competitiveness gathered by the World Economic Forum, the authors identify fifteen countries, including the United States, that have been among the top twenty countries in competitiveness rankings for at least eight of ten years. ... They find that every one of these countries, except the United States, guarantees some form of paid leave for new mothers as well as annual leave. And all but Switzerland and the United States guarantee paid leave for new fathers. ... The majority of these countries provide paid leave for new mothers, paid leave for new fathers, paid leave to care for children’s health care needs, breast-feeding breaks, paid vacation leave, and a weekly day of rest. Of these, the United States guarantees only breast-feeding breaks (part of the recently passed health care legislation)."

Here are some illustrative tables showing policies in these countries. The U.S. does not have paid parental leaves. All of the 14 comparison countries in the table offer such paid leaves for mothers, lasting at least 18 weeks and in some cases more than a year, and replacing at least 25% of salary and up to 100% of salary. Thirteen of the 14 comparison countries offer paid parental leave, ranging at the low end from a few days or a couple of weeks up to more than a year, and replacing from 25% of pay up to 100%.

The next figure looks at  leave policies for attending to children's health care. U.S. law does have provisions for breast-feeding breaks, as do 7 of the 14 comparison countries. All of the countries, including the U.S., have provisions for leave to care for children's health needs--but unlike in the U.S., that leave is paid in 11 of the 14 comparison countries.


The final table looks at policies on paid annual leave, a weekly day of rest, or night work. These are not policies specifically aimed at parents, but at all workers. The United States has no law guaranteeing paid annual leave, while all 14 of the comparison countries do--often requiring four or five weeks of such leave. Thirteen of the 14 comparison countries also have legal guarantees of at least one day of rest each week.



Earle, Mokomane, and Heymann discuss evidence that paternal leave policies of various sorts are associated with improved infant health and lower infant mortality--in part by enabling more breastfeeding, in part by enabling parents to be more involved in preventive and other health care for their children.  They argue that parental leaves help to foster "children’s social, psychological, behavioral, emotional, and cognitive functioning."

I'm enough of an American at heart that some of these international comparisons open my eyes pretty widely. In Germany, you can have more than two years of paid leave for both mothers and fathers? In Austria, Denmark, Sweden, and the United Kingdom, there is a national legal guarantee of five weeks of paid vacation? I'm enough of an economist to wonder about the incentives that such provisions give employers to avoid hiring women of child-bearing age, or to slot young people into into certain jobs where they can be replaced without too much fuss if they disappear for a couple of years. With workers who make middle-income salaries or higher, guarantees of paid vacation can be considered part of their overall compensation, but for low-paid, low-skill workers, such rules may discourage hiring them at all. I'd want to know more about how such policies are designed and enforced before enacting them in the United States.

But it is just  a fact that the U.S. labor market is at the far end of the international spectrum of high-income countries in not offering these kinds of policies. Even with my born-in-America, economist-trained skepticism, I find myself thinking that experimenting with such policies at the firm level, the state level, and even the national level is worth a closer look. After all, the days when American society could count on nearly all mothers to exit the (paid) workforce and spend their time in childcare and homemaking are long behind us.

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David Paul writes:

"I happen to be a student from Germany and just had this topic in school, so I wanted to clarify the laws a bit. You wrote: "I'm enough of an American at heart that some of these international comparisons open my eyes pretty widely. In Germany, you can have more than two years of paid leave for both mothers and fathers?"

"It's actually not quite that extreme. 14 weeks vacation for the mother at 100% pay are standard (6 before birth and 8 after - the 8 after are mandatory - paid by the statutory health insurance). After that, either the mother or the father can stay at home for a year at ~66% previous pay (this is paid by the government). They can switch in that time, for instance mother half the time and father half the time - in that case it goes up to 14 months. Or alternatively one parent can stay at home for 2 years, but then at only ~33% of previous wages. This doesn't change the basic point on the difference between the US laws and those of the other countries of course."  David adds: "The laws can be found in the MuSchG and the BEEG."

Michael Cain writes:

"As I am inclined to say, the US, particularly over the last 30 years, has made policy on the basis of making the country be a good place to be a capitalist, while most of the other developed economies have made policy on the basis of making their countries be a good place to be a worker.  Personally, I tend to believe that the latter works out better for social outcomes, although it's possible to go overboard, of course.  Business owners, once forced into the corner where they must have and keep employees, and must pay a living wage, and must contribute as necessary to provide benefits such as universal health care access, are *very* good at finding ways to increase the efficiency of the employees so that the owners still make money: they demand better education, they invest in better equipment, they listen to their workers (eg, Japanese auto companies make their engineers design for easy construction as well as other attributes).  The US has let business owners take the easy way out: drop health insurance, relocate the factory to a different region or foreign country, and so forth."

You've Gotta Be Kid-ding



When news broke a couple of years back in HK that a famous sportswoman Lee San San said that to raise a kid in HK would cost in the vicinity of HK$3mn, all hell broke lose. I tend to agree with her. Most parents know that its not cheap to raise a kid in the city, but no one actually sat down to tabulate the the actual cost. Now a new study in the US came out with equally similar conclusions, that it will cost US$291,570 for a middle income family to raise a kid. That's close to HK$2.3mn, so Lee San San was not that far off. Get this, it DOES NOT INCLUDE the cost of childbirth or college.

If you were to revert that to Singapore dollars, that would be S$417,994 ... which I am pretty sure is more than 90% of all CPF account holders have in their CPF at 55. You can still get by if higher education is largely subsidised, I guess. Imagine if your kid is neither brilliant enough to get a scholarship or a partial scholarship and you are not poor enough to qualify for special loans - that's Die Hard Part 4 ... Die Standing.

The amounts are a bit off the center when you talk about Malaysia as we have a different purchasing power model. I think you can even convert dollar for dollar, USD into ringgit, it would be closer to the mark, i.e. US$291,000 = RM291,000 (I am refering to a middle class family raising a kid in the city in Malaysia).

I have a married couple who are close friends and they have 4 kids, all smart buggers and will be college bound, but their joint household income is comfy but not excessively high at RM15,000 a month. They bought a new house two years back for RM650,000 and spent RM150,000 on renovation, and end up owing the bank RM400,000 still. I said to them, you know you are paying down the house to fund your children's education, and you better hope none of them turn out to be bastards as you probably need them to feed you in your later years. Its a stressful situation, can you afford to take the whole family overseas for holidays... probably not, gawd forbid if one of them should lose their job!!! Is that a dream or a nightmare in the making?

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WASHINGTON - A MIDDLE-INCOME family can expect to spend US$291,570 (S$417,994) including inflation to raise a child born in 2008 to adulthood, the government estimated on Tuesday, up slightly from the estimate made a year ago.

The estimate covers food, shelter and other necessities for a child to age 18, said the annual report by the Agriculture Department.

The figure does not include the cost of childbirth or college.

Housing accounts for one-third of expenditures on children. Food accounts for 16 per cent, the same as child care and education, said the Expenditures on Children by Families report. Last year, the USDA estimated it would cost US$269,040 to raise a child born in 2007 to age 18, including inflation. The USDA has made the estimates since 1960, when the estimated cost was US$25,300.

The department said it planned to have an updated 'Cost of Raising a Child Calculator' on the Internet soon. Annual spending for child-rearing ranges from US$11,610 to US$13,480 for a middle-income, two-parent family, the USDA said. Families with lower incomes will spend less and families with higher incomes spend more.

Expenses are highest in cities in the US north-east, followed by urban areas of the West and Mid-west. They are lowest in rural America and cities in the South. -- REUTERS


p/s photos: Son Dam Bi
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