How Do Firms Respond to Parental Leave Absences?

Brenøe, Anne Ardila, Krenk, Urša, Andreas Steinhauer and Josef Zweimueller

No 20140, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: How do firms adjust their labor demand when a female employee takes temporary leave after childbirth? Using Austrian administrative data, we compare firms with and without a birth event and exploit policy reforms that significantly altered leave durations. We find that (i) firms adjust hiring, employment, and wages around leave periods, but these effects fade quickly; (ii) adjustments differ sharply by gender, reflecting strong gender segregation within firms; (iii) longer leave entitlements extend actual leave absences but have only short-term effects; and (iv) there is no impact on firm closure up to five years after birth.

JEL-codes: H2 H5 J08 J13 J2 (search for similar items in EconPapers)
Date: 2025-04
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