The Economic Benefit of Paid Leave for the Lowcountry

Written by: Barry Waldman
Photo by Kristina Paukshtite from Pexels

A bill to provide paid parental leave to state employees that already passed the House with nearly unanimous support hangs in limbo in the state Senate in the last days of the legislative session. The bill would provide 12 weeks of paid family leave for the birth or adoption of a child.

Federal law has, since 1993, required businesses with 50 or more employees to provide unpaid family and medical leave. That leaves 40% of workers ineligible, and of the rest, nearly half report they cannot afford the time away. Unpaid family leave is equivalent to little or no leave for many single mothers and women in low-income jobs.  Women historically carry a disproportionately higher share of the burden for all family caregiving, including elderly parents, in-laws, etc., whether married or not.  This has directly impacted promotional opportunities, advancement in jobs, and thus earnings.

Paid Leave in the SC Legislature

A House bill passed overwhelmingly in January and a Senate bill passed the Senate Finance Committee unanimously in March and has the stated support of the Governor. It now has other committee hoops to jump through and may run out of time before the legislative session concludes on May 13.  That would stall its progress until the next session in 2022.

“We want to keep people working,” McMaster has said. “We don’t want them to quit work and have to go home and take care of a child.” In the private sector, many large companies are committed to family leave of at least 12 weeks. Companies like Boeing, Volvo and Bank of America employ liberal paid leave policies as a tool to recruit and retain talent and to burnish their corporate image, both as a community partner and as an employer.

The Business Case for Mandatory Paid Leave

The social value of paid leave has always been its rallying point, with research demonstrating its effectiveness in improving maternal and infant outcomes, and in addressing racial inequities in maternal/child health outcomes. Today, the economic benefits are becoming clear.

The Lowcountry Graduate Center, most governments and many employers recognize the business case to offering leave with pay. In a community whose economic drivers include the hospitality and healthcare industries, a pair dominated by female employment, studies have shown that employee retention, productivity and engagement are enhanced by paid leave policies.

A study by Boston Consulting Group found women with paid family leave are 93% more likely than those that take no leave to remain employed one year after having a baby, Google, Aetna and Accenture are three national companies that installed paid leave in the last few years and reported increased retention of female employees.

Federal Proposals for Paid Leave

Since last October, the Federal government has been providing 12 weeks of paid leave for employees and President Biden has proposed phasing in that requirement over a decade to all private sector employees as part of his $1.8 trillion American Families Plan.

Under that legislation, and similar standalone proposals endorsed by the national Paid Leave for All campaign, an increased payroll tax, funded in part by employers and in part by employees, would bankroll paid leave, maintaining a level playing field for employers regardless of the number of women of childbearing age they employ.

Broad Support From Business, Government, Americans

The U.S. Small Business Chamber of Commerce has endorsed this effort. The U.S. Chamber of Commerce has voiced its willingness to support a single, national policy, rather than a jigsaw puzzle of mandates from one state to another. Large majorities of Americans, according to the Pew Research Center, support paid leave, though they may differ on whether employers or government should be responsible.

Because the nation has achieved rare consensus around the issue of paid leave, advocates are scrambling to get legislation passed. “Hopefully everyone feels the urgency that now is the time,” said Ashley Crary Lidow, director of policy and government relations at Women’s Rights and Empowerment Network in Columbia.

“Paid leave equips workers, our state and country with the ability to balance their home life and work life, bring their best to the job, and employers to recruit and retain the best workers we can in a competitive labor market,” said Lidow.

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