What’s the future of American parental leave?

Written by Technically Media CEO Chris Wink, Technical.ly’s Culture Builder newsletter features tips on growing powerful teams and dynamic workplaces. Below is the latest edition we published. Sign up to get the next one.

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It was a week into the George Floyd protests and fewer than 90 days into the pandemic and ensuing economic collapse. I feverishly sent emails from the hospital — operationally, our financial systems were breaking down, our sales and marketing approach just shifted for the third time in as many months and we weren’t sure what was happening to the world. I sent a few less frantic emails in those early days, too — likely instead of faulty sleep in an uncomfortable hospital chair.

As a small business founder and CEO, my relationship with our own time-off benefits is just fundamentally different. I try to demonstrate the importance of taking time. For years, I disconnected on real vacations and rarely sent emails outside of office hours.

The pandemic has strained what was already a tricky balance. I still can’t imagine myself as CEO fulfilling in summer 2020 even our company’s base-level parental policy of eight weeks of full PTO. That says more about me than us at Technical.ly. In contrast, an influential member of my leadership team just returned from 12 weeks of parental leave.

This fall, I’m expecting my second kid to arrive. Though new recessionary threats loom and the pandemic continues, none of it compares to the madness of 2020.

That means I’ve spent a lot of time reconsidering parental leave. I’m not alone.

The Society for Human Resource Management (SHRM) recently released its annual employee benefits survey. The results caused a stir. For instance, SHRM reported a stunning drop in the share of US organizations offering paid maternity leave of any kind  — from 53% in 2020 to 35% this year. The total offering for new fathers faltered, too, down to 27% from 44%.

The narrative goes that employers are pulling back generous packages as the pandemic hiring blitz subsides in favor of economic decline. Notably, streaming service Hulu slashed its paid parental leave policy from 20 weeks down to eight, according to the Wall Street Journal.

Famously, the US is the only rich country without any federally mandated paid parental leave. That’s despite well-established health and wellness benefits, as well as workplaces distinguishing themselves by how well they accommodate parents.

The US remains one of few industrialized nations — and the only nation within the Organization for Economic Co-operation and Development (OECD) — to offer no nationwide statutory entitlement to paid leave. Beyond current swings, roughly two in five domestic companies offer some kind of paid leave for new mothers (and even less for fathers), but that skews toward larger companies. Job search firm Zippia noted that just 15% of companies with 99 or fewer employees offer some paid program.

Why don’t we have more parental leave?

We can put resistance to parental leave programs into three groups: They’re expensive; they’re disruptive and they’re narrowly adopted.

Paying employees who aren’t working, while good for attracting and retaining teammates, is certainly more expensive than, say, catering lunch in the office. Also, parenthood is declining: Just 40% of US households included a kid under 18 last year, down from over half in 1980. So, parental leave is an expensive, disruptive benefit that targets a minority of your workforce.

That might be why the more generalized idea of “family leave,” which incorporates caring for sick or elderly relatives, has grown. In either case, three-quarters of US employers subsidize their programs with another employee benefit: short-term disability insurance. This will typically cover 60% of an employee’s salary for six weeks, which some employers use as their parental leave offering.

For my money, I see eight to 12 weeks of 100% paid parental leave as a competitive offering that actually gets parents over the toughest newborn days. That is especially true for the physical demands of new motherhood, but the need for family bonding and household logistics should not be discounted.

That kind of offering is generous by American standards, but still meager compared to other industrialized nations. As far back as 1970, the average rich country offered new mothers 16 weeks of paid leave; by 1995, that was as high as 43 weeks. In 2021, the average new mother in such a country was offered nearly a year of paid parental leave, according to the OECD.

Those investments in new parents are remarkable to my American eyes. Such lavish policies do come with drawbacks, as European economies (and birth rates) routinely lag the United States. But it’s easy to see our American standard as oppressively backward.

As I prepare for my second child, I intend to take more time away from work than I did in the firestorm of 2020, maybe most of a month. I’ll check in, though. As a business owner, entirely disconnecting doesn’t make me any happier. The stress it would give me would make me a worse father, not a better one. Small business owners just have to operate differently.

I sheepishly remind my teammates that, in this case, do as I say, not as I do. And I say to American professionals: Work for an employer with paid parental time and use it.

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