In a family setting with parents or guardians caring for young children, climbing out of poverty can be extremely difficult. In these situations, parents or guardians often struggle to balance the need to financially provide for the family while ensuring the well-being of the children. Within countries that do not provide adequate parental leave by law, this struggle heightens as parents often have to prioritize income over crucial child care time. In a 2012 survey, about 46% of employees did not take essential medical or family leave because they could not afford it. Working women may also face workplace discrimination if there are no parental leave protections. For instance, an employer may unfairly dismiss a worker due to pregnancy. In order for parents to successfully lift their families out of poverty, they need supportive parental leave policies that allow them more financial freedom and job assurance.

Parental Leave Policies

Britannica defines parental leave as an “employee benefit that provides job-protected leave from employment to care for a child following its birth or adoption.” Policies surrounding parental leave vary drastically across countries. For instance, in The Bahamas, women may only take “maternity leave once every three years.” On the other hand, Germany allows new parents to take “up to three years of parental leave to take care of a newborn until the child turns 3 years old.”

However, the International Labour Organization (ILO), an agency of the United Nations, has set recommendations for parental leave. The ILO “calls for a minimum 12-week leave” but recommends a 14-week leave ideally. In countries that offer paid parental leave, the ILO recommends that the payment amounts to “no less than two-thirds” of the parent’s previous salary, with complete coverage of health benefits. Another standard that the ILO set is the guarantee that a woman will not lose her job because of pregnancy.

The Importance of Parental Leave

According to Katrin Schulz of the World Bank Group, “ensuring that mothers and fathers have adequate paid leave for the birth of a child should be a priority for economic development.” To understand this better, Schulz says it is important to note that “adequate maternity leave can lead to lower infant mortality rates, health benefits for the mother, higher female labor force participation and increased breastfeeding rates.”

On the other hand, paternity leave also has a wide range of advantages in terms of development outcomes, such as “health and economic benefits to the mother, more equitable division of household labor and increased child bonding.” In fact, studies specifically link paternity leave allowances to “increased earnings for the mother, reduced mother-absenteeism due to sickness and higher female employment in private firms.” All of these factors, in the long run, will improve the family’s well-being and ability to rise out of poverty.

Parental leave laws play an important role in poverty reduction. For impoverished families, paid parental leave proves essential for their economic well-being. Additionally, in its cross-national comparison of parental leave, the World Policy Center found that more extensive parental leave policies correlate with a decreased risk of poverty for both two-parent households and single mothers. The extra money that some parental leave programs may provide support the family economically and may also boost income following parental leave.

Progress in Parental Leave

Some of the most successful parental leave programs come from European and Nordic countries. Norway is one of the more generous countries in terms of paternal leave. Its policy allows 12 months of leave for each birth and a “parental benefit,” which stands as a source of income for new parents during the leave period. Both parents can take leave until the child reaches age 3.

Norway’s leave policy has helped narrow the gender income gap down to 13%. “The retention of women” in the workforce has also helped Norway collect higher tax revenue, strengthening the economy. These tax benefits contribute to Norway’s high GDP per capita, which now stands at $89,741, a representation of the country’s economic prosperity. Nordic countries aimed to reduce the stigma surrounding paternal leave with a campaign to normalize paternal leave. Now, about “90% of Norweigan fathers” take paternal leave, bringing wide-ranging benefits on a household level as well as a national level.

Norway’s example shows how parental leave policies can be beneficial not only for the families raising children but the economy surrounding them. Better parental leave is a small push toward building a more prosperous future. When children receive proper care in the first years of life, they have a better chance of breaking generational cycles of poverty.

– Hariana Sethi
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