Jennifer Sheridan | August 2024

We all value time spent with friends and family. But in the United States, paid family and parental leave isn’t a given. Federal legislation mandates unpaid leave for the birth of a child, a personal illness, or to be a caregiver for a sick family member – but only for eligible employers. A few states have introduced legislation that strengthens the federal requirements and offers new parents and employees paid leave for qualifying events.

Pennsylvania is considering becoming one of these states. As of 2022, an estimated 66% of workers in Pennsylvania didn’t have access to paid family and medical leave benefits. Currently, there is a bill on the floor that would provide up to 20 weeks of paid leave for parents or people recovering from an illness or surgery. Until then, employers play an important role in extending access to paid medical leave. Only 27% of employees get employer-provided paid leave. More businesses now recognize the importance of paid parental leave as vital for their business objectives. Here are some trends that explain why businesses are offering paid family and parental leave:

Encourage retention and productivity.
Among first-time mothers, those who take paid leave are more likely than those with unpaid or no leave to return to the same employer. Replacing an employee can outweigh the cost of offering them paid leave. SHRM estimates that in addition to the hard costs of finding and onboarding a new employee, soft costs, like lost productivity, can increase the expense of replacing an employee by as much as 60%. Additionally, a 2017 study of 1,500 employers found that 80% of companies that offer paid family leave reported positive impacts on morale and 70% saw an increase in employee productivity.

Increase the long-term mental health and well-being of employees.
Without dedicated paid family and personal leave, people often need to repurpose whatever vacation time is available to them. Over time, this can contribute to burnout and other negative mental health outcomes like depression. For example, one study found for every 10 additional days of paid vacation leave, the odds of depression in women were 29% lower. This connects back to businesses’ retention objectives: employees who experience mental health and well-being challenges in their workplace are four times more likely to seek other employment.

Promote greater equity in the workforce.
The current access to parental leave is largely reserved for women and birthing parents. The majority of non-birthing partners take fewer than 10 days off after welcoming a baby. In addition to the impacts on the non-birthing partners, this also impacts women in the workplace. However, the effects of paid leave have clear benefits for women’s career opportunities: women who take paid leave are 93% more likely to still be in the workforce 9 to 12 months after a child’s birth than women who take no leave. As equity becomes an increasingly important consideration for employee satisfaction and overall company reputation, ensuring comprehensive parental leave policies can go a long way in proving an organizations’ values. Employees who believe their employer cares for their overall well-being are 69% less likely to look for a new job. With parental leave specifically, half of 1,000 employed adults, said that they would pick more parental leave over a pay raise at work.

Employers enhance their values and useful assets by offering paid parental leave, which directly impacts their bottom lines. By investing in parental and family leave policies, companies support their workforce and improve both employee well-being and financial performance.