If fathers take parental leave it helps keep women in the workforce and encourages female career progression. It also helps close the gender pay gap.
Across the developed world, full-time female employees typically make about 80 cents for every dollar earned by a male worker. And while much effort is being put into reducing this gap, research into the impact of parenthood on worker’s earnings indicates that the gender pay gaps actually widen with parenthood.
On average, working mothers take an additional 4% hit to their paycheck, with low-wage employees suffering an even-larger 6% penalty.
Encouraging fathers to take parental leave is one way to combat this problem. A 2010 study by the Swedish Institute for Labour Market Policy Evaluation looked at a mother’s earnings in the first four years after having a child, and found that for every month of leave a father took, the mother's earnings increased by 7%, per year!
(Sidebar: This 2010 study is cited all over the place by those advocating for parental leave and gender equality. And while the 7% annual increase sounds great for women, we feel it’s important to let readers know that there is still debate about what happens to the wages of men who take leave.
Some studies have found that a man’s earnings increase after he has a child, a so-called “fatherhood bonus”. However, others have documented wage declines. In particular, the 2010 Swedish study mentioned above found that for each month of parental leave taken by a father, his earnings were reduced by around 7.5% per year. The authors did note that the “longer-run effects are usually found to be smaller due to rebound effects and catching-up.)
The bottom line: Women who want to be paid like their male counterparts should encourage fathers to take parental leave.