Lab Events

Parental Leave from the Firm’s Perspective

Gozde Corekcioglu

Parental Leave from the Firm’s Perspective

by Gozde Corekcioglu (Ozyegin University)

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In this study, we investigate firm side responses to generous parental leave mandates. Our primary focus is on firms’ adjustments in the gender and age composition of their workforce. To identify these effects, we use employer-employee matched data from Norway, and deploy a Bartik-type instrument exploiting variation in exposure and shifts across firms due to a series of expansionary reforms of the duration of paid parental leave.We find that in response to longer parental leave related absence, firms increase demand for young female employees but at lower wages. Heterogeneity analyses reveal that this is particularly the case in the private sector. We also document some positive effects on firm performance measured by investment and productivity. Increased part-time work by young women, and overtime hours by older workers emerge as important mechanisms explaining our results. Our findings suggest that both small and large firms have successfully adapted to young women’s work interruptions linked to longer parental leave, an issue that has so far been overlooked in labor markets.


Gozde Corekcioglu is an Assistant Professor of Economics at Ozyegin University and a Research Affiliate at the Institute for the Study of Labor (IZA). She holds a Ph.D. in Economics from the European University Institute (EUI). Her research interests include: Labor Economics, Gender and Economics, and Political Economy. Her recent work focuses on transforming workplace climate, female leadership in organizations, and gender diversity in the workplace.