THE RECENT SLOWDOWN IN 

NINE FACTS ABOUT AMERICAN 

FAMILIES AND WORK

 

The Council of Economic Advisers

June 2014
2

Contents

Introduction .....................................................................................................................................................3

 Fact 1: Mothers are increasingly the household breadwinners...................................................4

 Fact 2: Fathers are increasingly family caregivers.. .......................................................................9

 Fact 3: Women make up nearly half of today’s labor force. ........................................................4

 Fact 4: Women are increasingly among our most skilled workers, attaining the majority of 

college degrees, and deepening their work experiences..............................................................6

 Fact 5: Most children live in households where all parents work. ............................................11

 Fact 6: Caregiving doesn’t end when the children are grown: eldercare is a growing 

responsibility of workers. ................................................................................................................12

 Fact 7: Men and women alike face challenges as they try to balance work and family.........13

 Fact 8: Many workplaces have not kept up with the needs of 21st century workers and 

families. ..............................................................................................................................................14

 Fact 9: Providing workplace flexibility and paid leave strengthens families, businesses, and 

our economy......................................................................................................................................17

References......................................................................................................................................................19
3

Introduction

In this report we lay out nine important facts about American families and work which together 

illustrate the changes that are needed to ensure our long-term economic growth, maintain our 

economic competitiveness, improve the well-being of Americans, and make full use of all of 

America’s talent.

The interaction between our family lives and our work lives has profound implications for our 

economy. Most workers have caregiving responsibilities for others—children, elderly parents, aunts, 

or uncles, spouses, or adult children with disabilities, including returning veterans. Trying to balance 

breadwinning and caregiving responsibilities without the support of work-family policies designed 

to help families navigate these complexities is leaving too many families stressed, exhausted, and 

burdened by work-family conflict.

These choices that families face as individuals are intimately linked to the success of our businesses

and our economy. When workers are choosing companies based on their family-friendly policies, 

the companies that adopt such policies are better able to attract and retain talent. And when more 

companies have adopted such policies workers will be able to choose their job focusing more on 

where they will be most productive.

Growth in women’s labor force participation and earnings has been essential for both family 

incomes and our overall economy. Without the gains women have made since 1970, median family 

income would be $13,000 less today and our overall economy would be $2 trillion dollars smaller. 

Making it easier for everyone to participate in the economy to their fullest potential is an essential 

ingredient in economic success.
4

Fact 1: Mothers are increasingly the household breadwinners.

Mothers are bringing home more of family income than ever before. Mothers’ income is not just 

supplemental—it is increasingly a necessary source of funds to pay for childcare, housing, 

transportation, and other essentials. More than 40 percent of mothers are now the sole or primary 

source of income for the household. This reflects both a rise of single mothers, 65 percent of whom 

participate in the labor force, and the fact that more married women are out-earning their 

husbands.1 Overall, 24 percent of married women earn more than their husbands compared to only 

7 percent in 1970.2

Most of the growth in family incomes over the past several decades has come from women’s rising 

earnings. In 2013, the income of employed married women comprised 44 percent of their family’s 

income, up from 37 percent of household income in 1970.3 Turning to all women, we see that their 

income has tracked the rise in GDP per capita, while male income has stagnated. That means that 

nearly all of the rise in family income since the 1970s has been due to the earnings of women. In 

fact, if women’s participation had not increased since 1970, median family income would be about 

$13,000 less than what it is today.4

Both men and women think it is important that women work either full time or part-time, regardless 

of their children’s ages, and increasingly, both men and women disagree with the male-breadwinner 

model of the family.5

 

1 Bureau of Labor Statistics, Current Population Survey

2 CEA analysis of Current Population Survey

3 CEA analysis of Current Population Survey, shown in the Council of Economic Adviser’s “Women’s Participation in in 

Education and the Workforce” March 12, 2014.

4 CEA analysis of Current Population Survey

5 General Social Survey, 2002, 2012; CEA calculations.

0

50

100

150

200

250

300

350

400

1947 1957 1967 1977 1987 1997 2007

1947 = 100

Per Capita GDP

Women's Median Weekly Earnings

Men's Median Weekly Earnings

Per Capita GDP and Median Earnings Growth by Gender

Source: Bureau of Economic Analysis; Current Population Survey; and CEA Analysis.
5

Despite the rising importance of mothers’ earnings to family income, women in the U.S. are still paid 

on average only 77 cents for every dollar a man makes.6 Closing the gender wage gap is important 

for improving family outcomes, such as reducing the number of individuals, and especially children, 

who live in poverty. Furthermore, CEA estimates that increasing the wages of working women by 10 

percent would lift nearly 1.3 million individuals out of poverty. One policy that could make progress 

in this direction--increasing the federal minimum wage to $10.10 per hour-- would decrease the 

gender wage gap by 5 cents.7 

 

6 Bureau of Labor Statistics, Current Population Survey

7 White House. 2014. “The Impact of Raising the Minimum Wage on Women and the Importance of Ensuring A Robust 

Tipped Minimum Wage.” 

http://www.whitehouse.gov/sites/default/files/docs/20140325minimumwageandwomenreportfinal.pdf

0.00

0.20

0.40

0.60

0.80

1.00

0

10,000

20,000

30,000

40,000

50,000

60,000

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

2012 $ Female-Make Earnings Ratio

Female Earnings (Left Axis)

Male Earnings (Left Axis)

Earnings Ratio (Right Axis)

Female-to-Male Earnings Ratio and Median Earnings 

of Full-Time Full-Year Workers

Source: Current Population Survey and CEA Analysis.
6

Fact 2: Fathers are increasingly family caregivers.

Dads are increasingly playing the role of the primary caregiver in the household. Today 1 in 5 fathers 

are now the primary caregiver of preschool-age children when the mother is employed.

8

In the last 

25 years, the number of stay at home dads with a working mom doubled.

9

In the last four decades, 

the number of father-only families more than tripled, and currently 7 percent of families with 

children are father-only families.

10

In keeping with the shift in marriages to equal partnerships based on shared interested and 

background, with both partners contributing to income and caregiving, fathers change diapers, give 

bottles, and bring children to and from school. Although fathers continue to spend less time on 

childcare than mothers, this gap has narrowed over the past 10 years, and dads are increasingly 

performing caregiving activities traditionally done by mothers. Overall, fathers are spending more 

time on childcare and housework, and have not reduced their paid work hours by a commensurate 

amount. In 1965, fathers spent 49 hours per week doing paid work and taking care of their family; 

in 2012 that jumped to 54 hours per week.

11 Fathers are doing 4.6 more hours of child care per week 

and 4.4 more hours of housework per week, yet two-thirds of men and nearly three-quarters of 

women think that men should be spending more time caring for children.12

 

8

Survey of Income and Program Participation, 2011

9 Census Table MC1 from 2013 Current Population Survey

10 Census Table FM-1 from Current Population Survey

11 Bianchi et al. (2006); American Time Use Survey; CEA calculations

12 General Social Survey, 2002; CEA calculations.

58 62

56

65

82

95

0

20

40

60

80

100

2002 2010

Help with Homework Read to Kids Bathe and Diaper

Fathers' Reporting Role in Childcare Activities

Percent

Note: Data show the percentage of fathers age 15-44 who report they participate in the activity at 

least several times per week. 

Source: National Survey of Family Growth, 2002-2010; CEA calculations.
7

With dads working 5.5 hours more per week doing paid work, housework, and childcare compared 

to 1965, it is no surprise that the majority of dads are looking for a solution to work-family conflict.13

In 2008, 60 percent of dads in dual-earner couples reported work-family conflict compared to 35 

percent in 1977.14 And dads are starting to vote with their feet, looking for jobs that allow more 

flexibility, require less travel, or include paid paternity leave. 

 

13 All statistics from CEA analysis of 2012 American Time Use Survey

14 Galinsky et al (2011) and Family and Work Institute (2002). 

0

10

20

30

40

50

60

1965 2012

Note: Fathers are defined as adult men ages 18-64 with children under 18. 

Source: Bianchi et al. (2006); American Time Use Survey. 

Hours Per Week Spent on Activity

Childcare (2.5)

Housework (4.4)

Paid Work (42.0)

Childcare (7.1)

Housework (8.8)

Paid Work (38.5)

Fathers' Average Weekly Time Use
8

Fact 3: Women make up nearly half of today’s labor force.

Today’s workforce is comprised more equally of men and women than in the past. Today women 

make up 47 percent of the labor force, compared to 38 percent in 1970.

15 While women continue 

to work fewer hours then men on average, women are working more hours than they used to and 

their share of total hours has risen 10 percentage points over the past 40 years.16 This growth in 

women’s paid work was responsible for nearly a fifth of the growth in real GDP in the 1970s and 

1980s. Today, our economy is 13.5 percent larger than it would be if women were employed at the 

same rate that they were in 1970 and worked the same number of hours on average. That’s an 

additional $2.0 trillion in GDP due to the increased attachment of women to the labor force since 

1970.

17

The lesson is clear: if we want to increase the pace of economic growth we should make it easier for 

more men and women to participate in the labor force. After rising rapidly in the 1970s and 1980s, 

women’s participation in the workforce has stagnated in recent decades. Indeed, over the last 

fifteen years, the only gains in women’s labor force participation have come from those age 55 and 

over. However women have continued to make gains as a share of the workforce both because the 

hours gap between men and women has continued to narrow and because men’s labor force 

participation has continued its long-run decline. 

In 1990, the U.S. ranked 7th among 24 developed countries in women’s labor force participation, but 

by 2012, the U.S. had fallen to the 16th position.18 Not unrelated, the U.S. increasingly lags other 

developed countries in providing flexible work and paid leave arrangements that enable all workers 

to be a part of the workforce and to build long-term careers, while also providing care for their 

families.19

 

15 Bureau of Labor Statistics, Current Population Survey. These figures include individuals ages 16 and older as well as 

self-employed workers, who are 58 percent male.

16 CEA analysis of Current Population Survey

17 CEA calculations. It includes the impact of increasing hours and participation.

18 OECD (2012)

19 Blau and Kahn (2013). 

50

60

70

80

90

100

1990 1994 1998 2002 2006 2010 2014

Netherlands

Percent

International Comparison of Women's Labor 

Force Participation Rate

Germany United States

France

Canada

Note: Data are for women ages 25-54. Workers on leave are included in the labor force.

Source: International Labor Organization.

Sweden
9

Fact 4: Women are increasingly among our most skilled workers, attaining 

the majority of college degrees, and deepening their work experiences.

Women are fast becoming our most educated workers—they are attending school at higher rates, 

and they are entering a wide range of careers and deepening their work experience. Women’s 

educational attainment grew during the 1970s and 1980s, catching up with college-going rates of 

men. In the early 1990s, women were as likely as men to graduate college, but women’s growth in 

educational attainment has continued and today substantially more women than men attend and 

graduate college. This rise in college attendance takes time to show up in the labor force, but 

women’s share of the college-educated labor force is rising. Moreover, the education pattern of 

young workers makes it clear that women will soon be the majority of college-educated workers. In 

2013, women ages 25-34 were more than 20 percent more likely than men to be college graduates.20

Women are also deepening their labor market experience, closing the gap between their work 

experience and that of their male counterparts. In 2012, the gap in median job tenure closed for the 

first time since the Bureau of Labor Statistics began measuring the figure in 1983. In those thirty 

years, women’s median job tenure has increased nearly 30 percent (compared with a decline of 

about 9 percent in men’s median job tenure).21

Women also continue to make inroads in historically male-dominated occupations and in 

professional and graduate degree programs. In 1968, women made up less than 10 percent of the 

 

20 CEA analysis of Current Population Survey, shown in the Council of Economic Adviser’s “Women’s Participation in in 

Education and the Workforce” March 12, 2014.

21 Copeland (2012). 

25

30

35

40

45

50

55

1970 1975 1980 1985 1990 1995 2000 2005 2010

Bachelor's Degree

Percent

Source: CEA Analaysis of Current Population Survey, ASEC. 

Less than Bachelor's Degree

Female Share of the Workforce by Educational Attainment

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

1980 1984 1988 1992 1996 2000 2004 2008 2012

Median Job Tenure for Wage and Salary

Workers Age 25 and Older

Years

Men

Women

Overall

Source: BLS
10

entering classes of MD, JD, and MBA programs, but the share of female students has grown to nearly 

50 percent in each program. Today, female college graduates ages 30 to 34 are just as likely to be 

employed as doctors, dentists, lawyers, professors, managers, and scientists as they are to be 

employed as teachers, nurses, librarians, secretaries, or social workers. This reflects the closing of a 

substantial gap—women in the 1960s were 7 times more likely to be in the latter, traditionally 

female, occupations. More generally, in 1970, more than 60 percent of occupations were so male 

dominated that 80 percent or more of their workers were male. Today only about one-third of 

occupations are male-dominated by this definition. While much progress has been made in 

occupational segregation, clearly there is more work to be done in both getting women into 

predominately male-dominated occupations and men into female-dominated occupations. For 

instance, the share of occupations in which women are 80 percent or more of the workers has 

remained relatively constant at 10 percent.

22

In particular, women have not reached parity with men in some of the most highly compensated 

occupations. For example, less than 20 percent of graduates in computer science and engineering 

are women, down from 37 percent in 1985.23 Reducing barriers to female occupational choice, 

including gender discrimination, would not only raise women’s earnings, but would also increase 

overall productivity by better matching worker skills to jobs. Recent research has shown that women 

can help drive innovation and better target female customers and employees.24 In addition, studies 

estimate that 15 to 20 percent of wage growth in the last 50 years was due to a decline in barriers 

to occupational choice.25

 

22 CEA analysis of Current Population Survey, 1970, 2013.

23 Pew Research; National Science Foundation (2013). 

24 Center for Talent Innovation (2013)

25 Hsieh, Hurst, Jones, and Klenow (2012)

0

40,000

80,000

120,000

160,000

200,000

26 28 30 32 34 36 38 40 42 44

Average Salary of Professional Degree

Recipients by Age and Gender

US $

Men

Women

Age

Source: Current Population Survey and CEA Analysis.
11

Fact 5: Most children live in households where all parents work.

Today, across married and single parent families, all parents are working in more than 6 out of every 

10 households with children, up from 4 out of 10 in 1965.26 This includes both dual-earner couples 

as well as single working parents, both of which have been increasing. This steady increase over the 

last 40 years also holds for families with kids where the youngest child is under one-year old.27

While more families have all parents in the workforce, and therefore a need for childcare, affordable 

childcare has become increasingly hard to find. Child care costs have steadily increased in the last 

25 years, making it harder for parents to find affordable childcare when children are young and after 

school or when school is not in session.28 Even with affordable care parents must be able to handle 

the occasional call from their childcare provider telling them that they have a child too sick to stay 

in school or who needs to see a physician. Without workplace flexibility and a supportive work 

environment, it can be difficult for parents to handle these unexpected childcare needs, especially 

since almost one-quarter of adults report that they have lost a job or were threatened with job loss 

for an absence due to illness or having to care for a sick child or relative.29 This problem is even more 

acute for low-wage workers who are the least likely to have workplace flexibility options and can 

least afford to take unpaid leave. Moreover, low-wage workers often face unpredictable schedules 

with little advance warning making it challenging to schedule even routine well-child doctor visits or 

teacher meetings. 

 

26 CEA analysis of Current Population Survey. Including biological, step, and adoptive parents.

27 Current Population Survey; CEA Calculations

28 US Census Bureau (2013)

29 Smith and Kim (2010)

0

10

20

30

40

50

60

70

80

1970 1975 1980 1985 1990 1995 2000 2005 2010

Percent

Note: Includes single parents and dual-earner households.

Source: Current Population Survey, Annual Social and Economic Supplement, and CEA Analysis.

Youngest Child 

Under 12 Months

Children of Any Age

Percent of Parents in Households in Which All Parents Work

75

85

95

105

115

125

135

145

1985 1990 1995 2000 2005 2010

Weekly Child Care Costs Paid by Families with Employed Mothers

2010 $

Note: Weekly expenditures among persons making child care payments for all children in family 

younger than 15. Percentages derived from the ratio of average monthly child care payments 

(prorated from weekly averages) to average monthly income.

Source: Census Bureau.
12

Fact 6: Caregiving doesn’t end when the children are grown: eldercare is a 

growing responsibility of workers.

There are many people who need care besides children: the elderly and those with disabilities

including grown children, spouses, siblings, and returning veterans. Most people care for someone 

besides themselves or a child during their lifetime. Approximately 40 million Americans (16 percent 

of the population aged 15 and older) provide unpaid care to an elderly relative or friend each year.

30

Men and women are similarly likely to be providing eldercare, 15 and 17 percent respectively, 

although women spend slightly more hours per week providing eldercare than men (3.5 hours a 

week versus 2.9).

31 When providing eldercare, caregivers engage in a variety of activities, including 

providing physical and medical care, helping with housework, and socializing and communicating. 

The majority (63 percent) of people providing unpaid eldercare have jobs, with about half of 

caregivers working full-time. And one-fifth of eldercare givers are also caring for young children.

Parents who provide eldercare have even higher rates of employment—78 percent are employed, 

and 62 percent work full-time. These members of the “sandwich generation”—those caring for 

elderly relatives and young children—face special challenges in balancing work and family. The 

percentage of households with both children under 18 and adults over the age of 64 has been rising 

for the past 30 years. In addition, workers are also caring for relatives living outside the household—

and non-household members account for the vast majority (85 percent) of all unpaid eldercare.32

 

30 In 2011, the American Time Use Survey began asking questions about time spent caring for older individuals. The 

data reported are for 2011 and 2012.

31 Bureau of Labor Statistics (2013c)

32 Bureau of Labor Statistics (2013c). 

68

59

89

71

0

20

40

60

80

100

Men Women

All Parents

Percent of All Unpaid Caregivers Who Are Employed

Percent

Source: American Time Use Survey, 2011 and 2012.

0

1

2

3

4

5

6

1970 1975 1980 1985 1990 1995 2000 2005 2010

Share of Households with Children Under 18 and Adults Over 65

Percent

Source: Current Population Survey and CEA Analysis.
13

Fact 7: Men and women alike face challenges as they try to balance work 

and family.

Men and women are increasingly pressed for time and, as a result, struggle to meet their work and 

family responsibilities. Dads’ desires to be active caregivers and to share parenting with their 

partners has likely contributed to the unprecedented level of reported conflict between work and 

family among men. In 2008, 60 percent of fathers in dual-earner couples reported work/family 

conflict up from 35 percent in 1977 (a 71 percent increase in just one generation).

33 This proportion 

surpassed the number of mothers in dual-earner couples reporting work/family conflict.

Increasingly, both men and women report that work interferes with family—not the other way 

around.34 In 2010, 46 percent of working men and women reported that their job demands 

interfered with their family life sometimes or often, up from 41 percent in 2002. In contrast, less 

than 30 percent report that their family interferes with their work life.

 

33 Galinsky et al. (2011).

34 King (2005).

35%

60%

41%

47%

20

30

40

50

60

70

1977 2008

Source: 2008 NSCW, FWI and 1977 QES, U.S. Department of Labor.

Fathers in Dual-Earner Couples

Mothers in Dual-Earner Couples

Percentage of Mothers and Fathers Reporting Work-Family Conflict

Percent

41%

46%

29%

28%

20

25

30

35

40

45

50

2002 2010

Source: 2008 NSCW, FWI and 1977 QES, U.S. Department of Labor.

Work interferes with family

Family interferes with work

Percentage of Workers Who Report Work-Family Conflict

Percent
14

Fact 8: Many workplaces have not kept up with the needs of 21st century 

workers and families.

Workers struggling to balance their work and family obligations are increasingly choosing to work 

for employers that offer flexibility, and workers, in some cases, are leaving jobs that don’t offer the 

flexibility or time off they need to address their family responsibilities. Overall, a third of workers 

have passed up a job because it conflicted with family obligations, including 49 percent of working 

parents with kids under 18.35 Similarly, research finds that women are increasingly choosing career 

paths with flexibility over the year, week, and day such as dentistry, veterinary medicine, optometry, 

and pharmacy.36

 

35 Nielsen (2014). Harris Poll of 4,096 U.S. adults (aged 18+), conducted online May 27-30, 2014.

36 Goldin (2006). 

89%

36% 49%

52%

Nine in ten Americans believe employers should 

offer workers flexibility to meet their families’ needs, 

so long as their work gets done.

Over half of workers feel they could do their job 

better if they were allowed a more flexible schedule.

Nearly half of parents say they have have chosen to pass 

up a job they felt would conflict with family obligations.

More than a third of parents believe they’ve been 

“passed over” for a promotion, a raise, or a new job 

due to a need for a flexible work schedule.

Source: Nielsen (2014). Harris Poll of 4,096 U.S. adults (aged 18+), conducted online May-27-30, 2014. 
15

Dads are joining women in prioritizing jobs that allow more flexibility, require less travel, or include 

paid paternity leave. For example, a 2014 survey of high-skilled working fathers conducted by 

researchers at Boston College found that 89 percent of these fathers reported the availability of 

paid paternity leave as an important consideration in seeking a new job if they planned to have 

another child. Likewise, 95 percent of these working fathers reported that workplace flexibility 

policies allowing them to actively engage with their children were an important job characteristic.37

Popular rankings and lists such as the 100 Best Companies list, which is compiled each year by 

Working Mother Magazine to evaluate companies with over 500 employees on their workplace 

policies on parental leave, back-up and sick-child care, career advancement, and workplace 

flexibility, help working women and men identify family-friendly companies.38

The United States is one of three countries in the world, and the only developed country that does 

not have mandatory paid parental leave policies, which means that aside from a few states and 

municipalities that have adopted paid parental or sick leave policies, it is up to business to offer this 

important benefit. However, only 11 percent of private sector employers offer formal paid leave 

specifically for family reasons.39

The Family and Medical Leave Act guarantees unpaid leave, however it only covers about 60 percent 

of workers. 40 About half of workers believe that they could take paid leave for a family reason, 

although the gap between workers beliefs and employer compensation surveys suggests that this is 

comprised of a web of informal policies and an ability to use other forms of leave for family reasons

in addition to formal employer paid leave for family reasons.

41

The availability of paid leave and workplace flexibility policies varies substantially across the income 

distribution, and low-wage workers in particular face multiple workplace challenges, including 

inflexible, yet variable, schedules coupled with an abundance of part-time work. Only half of workers 

earning less than $540 a week (about $13.50 an hour at full-time hours) have access to any form of 

paid leave, compared to more than 80 percent of workers earning more than $1,230 a week ($30.75 

an hour at full-time hours).42 And low-wage workers are most likely to report not being able to take 

unpaid leave because they cannot afford it. On the other hand, high-wage workers report being 

unable to take leave because they have too much work.

 

37 Harrington et al. (2014).

38 Working Mother Media (2013). 

39 National Compensation Survey (2013).

40 Klerman, et al., (2013)

41 ATUS 2011, CEA calcualtions

42 CEA analysis of 2011 American Time Use Survey

Reason % Paid % Unpaid

Family 48% 71%

Own Illness 53% 73%

Vacation 56% 60%

Access to Leave 

Source: ATUS 2011, CEA calculations
16

Although less than half of workers currently have access to paid leave for family reasons, more than 

80 percent of men, and 90 percent of women, assert that women should have access to paid 

maternity leave.43 And about one-third of men (32 percent) and women (38 percent) report that 

mothers and fathers should take equal amounts of paid leave for the birth of a child.44

Finally, one additional way in which workplaces need to adapt to modern times is workplace climate. 

Women are leaving jobs, and in some cases careers, because of a sense of being in an uncomfortable 

or unsupportive environment. 56 percent of women drop out of computer science professions by 

midcareer – double the rate of men – in some cases because they experience sexist or demeaning 

workplaces.45 Specifically, nearly 40 percent of women who quit science, engineering, and 

technology jobs cite a “hostile macho culture” as their primary reason for leaving, compared to 27 

percent who cite compensation. Only about half of the women who quit jobs because of the culture 

continue their career in science, technology, and engineering fields.46

 

43 General Social Survey (2002)

44 General Social Survey (2012). The remaining two-thirds answered that women should take the majority or the entire 

amount of paid parental leave.

45 Hewlett at al. (2008). 

46 Hewlett at al. (2008). 
17

Fact 9: Providing workplace flexibility and paid leave strengthens families, 

businesses, and our economy.

Although workplace flexibility policies have an upfront cost, they have been shown to generate a 

positive return for employers. Policies that increase workplace flexibility, such as job sharing, phased 

retirement of older workers, flexible hours, and use of telecommuting, allow workers to continue 

making productive contributions to the workforce while also attending to family and other 

responsibilities. Having access to flexible workplaces is important to many workers: in 2006, 50 

percent of men and 57 percent of women reported that workplace flexibility and flexible hours were 

important or very important characteristics of a job.

47 Likewise, a 2011 Gallup Poll finds that having 

access to flexible work arrangements was highly correlated with greater worker engagement and 

higher well-being.48

Because they are important to workers, these policies help businesses attract and retain talent, 

contributing to a business’s bottom line. One study tracked the announcements of new work-life 

balance policies by Fortune 500 companies and found firms’ stock prices rose 0.36 percent on the 

days following announcements, suggesting investors believe these policies to be profitable 

investments. 49 A comprehensive study of 700 firms in the U.S. and Europe conducted by business 

management researchers found that work-life balance policies are positively associated with good 

management.

50 In addition, a randomized evaluation found that when call center employees were 

allowed to work from home, there was a 13 percent performance increase.51 Research suggeststhat 

both employees and employers can benefit from higher wages, better training, and benefits. Costco 

pays its employees about 40 percent more than its competitors, but Costco employees sell $986 per 

 

47 General Social Survey (2006).

48 Harter and Agrawal (2013); 

49 Arthur (2003). Similar findings have been documented over a longer time period. See Edmans (2011).

50 Bloom et al (2006). 

51 Bloom et al (2013). 

Study show increasing paid leave and flexibility at work

Benefits Companies

 Increase Productivity

 Helps recruit more talented workers

 Lowers worker turnover and replacement costs

 Reduces absenteeism

 Boosts profits and cut costs

Benefits Shareholders

 Lifts a company’s stock price when announced

 Shares outperform over the long-term

Benefits Workers

 Improves job satisfaction

 Alleviates challenges affecting work-family balance

Studies Show that Increasing Paid Leave and Flexibility
18

square foot, as compared to $588 per square foot at their largest competitor.52 Additionally, a 

survey of 253 employers affected by California’s paid leave program, which offers almost all private 

sector workers up to 6 weeks of paid leave, found that over ninety percent of employers reported 

either a positive effect on profitability, turnover, and morale or reported no noticeable impact.53

Because many employers may not have accurate information about the costs and benefits of 

workplace flexibility practices and because some of the benefits may extend beyond the individual 

employer and its workers, wider adoption of such policies and practices likely offers more benefits 

to firms, workers, and the U.S. economy than employers may realize. 

With women and men increasingly sharing breadwinning and caregiving responsibilities, today’s 

working families need a modern workplace—one with workplace flexibility, paid leave, and quality 

child and eldercare. Such policies are beneficial for the economy as they lead to higher labor force 

participation, greater labor productivity and work engagement and better allocation of talent across 

the economy. The International Monetary Fund and the Organization for Economic Cooperation and 

Development have both identified childcare policies and paid leave as important drivers of female 

labor force participation.54 These policies are also essential for long run growth as they allow for 

better bonding between parents and children which has been shown to lead to better outcomes for 

the kids as adults. Researchers have shown that children of women who receive paid maternity 

leave can earn on average 5 percent higher wages at age 30.55 More broadly, closing the malefemale employment gap would raise GDP by 9 percent.56

 

52 Ton (2012). 

53 Appelbaum and Milkman (2011).). 

54 Elborgh-Woytek et al. (2013). 

55 Carneiro et al. (2011).

56 CEA calculation. Other studies find similar results—see Aguirre et al. (2012) and Goldman Sachs (2007).
19

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