Impacts of work-life balance benefits on women’s work performance

Work-life balance benefits, aimed at encouraging a balanced participation between women and men in family and working life, stand as a tool to advance in terms of equal employment opportunities, to break down traditional gender roles, and to cover children’s care needs.

Factsheet

 

  • Geographical scope: OECD countries.

1. Context

Work-life balance benefits give a clear boost to female labour participation. These benefits also appear to lead to a widening of the pay gap, although the available data on this aspect is not entirely conclusive. Elements such as duration, amount and requirements for access to the benefits are key to determining the effectiveness of these welfare state devices.

2. Debate

Within the wide range of benefits included in the category of work-life balance benefits, those providing assistance towards hiring external care (whether in childcare facilities or in the home) would have a positive effect on female labour participation. However, the effects of benefits intended to compensate the various periods of leave (maternity, paternity, career breaks) depend mainly on their duration. While short and medium periods of leave (up to 12 months) seem to be associated with higher levels of labour participation, beyond that length the impacts of leave would appear to be insignificant, and possibly even negative.

With regard to the pay gap, benefits for hiring care and benefits for short and medium leave enable mothers to remain in closer contact with the work context and preserve the human capital associated with their job. This would have a minor effect on women’s pay. On the other hand, benefits for long-term leave and career breaks seem to have negative effects on women’s wages. Given that women are the main recipients of these benefits, the widening of the gender gap can be explained firstly by the depreciation of human capital caused by long absences from work. Furthermore, as they represent an additional cost for companies, they would penalise women by resulting in lower wages, among other aspects.

3. Conclusions

In most OECD countries, the correlation of expenditure between the benefit categories considered is found to be negative, i.e., the approach taken is to reinforce one of the categories at the expense of the other. In this respect, it should be noted that in countries with a “family-focused” reconciliation policy (in other words, where the family’s caregiving role is strengthened through benefits for taking long-term leave and career breaks rather than for hiring external care), the capacity of these benefits to encourage female labour participation would be weaker. In addition, these models would tend to widen the pay gap between men and women.