Page 5 - IDEA Studie 09 2020 Nechtene plody prorodinnych politik

NECHTĚNÉ PLODY PRORODINNÝCH POLITIK IDEA 2020 Study 9 / 2020 The Unintended Effects of Parental Leave Policies 2 DECEMBER 2020 ALENA BIČÁKOVÁ, KLÁRA KALÍŠKOVÁ, LUCIE ZAPLETALOVÁ Summary • This summative study is based on an academic article by Alena Bičáková and Klára Kalíšková, entitled “(Un)intended effects of parental leave policies: Evidence from the Czech Republic”, which was published in the Labour Economics journal in 2019. • Two reforms to parental allowance in the Czech Republic, in 1995 and 2008, which changed the period during which parents could claim state financial support to take care of their child, did not only affect how long mothers stayed at home with their children, but also had an impact on their risk of becoming unemployed upon returning to the labour market. • The 1995 reform extended the period during which parents could claim financial support from the state, from three years (i.e. until the child's third birthday) to four. However, it did not change the existing requirement for employers to protect the parent's job for a period of three years. The reform led to an increase in the share of women who remained economically inactive until their child reached the age of four, by an unexpectedly high 37.7 percentage points. As a result, it also reduced unemployment among women with three-year-old children, by 10 percentage points. • As a result of the extended period of parental allowance receipt, mothers began to return to the labour market later and therefore after the end of the three-year period during which their previous job was protected. This placed them at a greater risk of unemployment upon their return to the labour market. The rate of unemployment among mothers of four- and five-year-olds increased after the 1995 reform by 6.0 and 4.4 percentage points, respectively. 2 We are grateful to Daniel Münich and other colleagues for their very useful comments on the working versions of our calculations and text. Any remaining inaccuracies or errors, and any opinions here expressed are entirely our own as authors. We also thank the Czech Statistical Office for providing the data (VŠPS 1994-2013). This study was produced with financial support from the Czech Science Foundation, grant No. 18-16667S and as part of the Czech Academy of Sciences' AV21 Strategy. The study is based on Bičáková, A., and Kalíšková, K. (2019). „(Un)intended effects of parental leave policies: Evidence from the Czech Republic.“ Labour Economics, 61, 101783. 3