Who Benefits from Paid Sick Leave Policy? Firm Size and Women’s Employment Outcomes

• In Event: 21067 - Organizational Responses to Regulatory Changes

Abstract

This paper investigates how workers respond to state-mandated paid sick leave (PSL) using U.S. microdata on employment and firm size from 2010-2019. Studies have documented the overall effect of sick leave policies on women’s employment outcomes, but fewer have examined the role of firm size on policy changes. Exploiting the unique survey design of the CPS Annual Social and Economic Supplement (ASEC), which collects respondents’ labor market information for two adjacent years, we present three key findings. First, we identify no general change of leave take-up rate across firm sizes before and after PSL in the total population. Second, we find that state PSL increases employment rates for women previously employed in firms with fewer than 100 employees, while having no effect on those from larger firms. Third, the identified employment enhancement effect in small firms after policy intervention is driven by women with preschool children. Together, our results show that PSL is particularly helpful for mothers of young children employed in small firms, who face high demand for workplace flexibility due to childcare needs, yet have limited access to organizational resources for paid leave options.

Authors

• Yurong Zhang, University of Kansas

• Misty Heggeness