Family Friendly Workplace Policies

Category: Applied Microeconomics and Organization Seminar
When: 26 June 2024
, 14:15
 - 15:30
Where: RuW 4.201

Title: Family Friendly Workplace Policies (w/ Julian Costas Fernandez, Sebastian Findeisen and Uta Schönberg)

Abstract: The literature has studied the willingness to pay for family friendly amenities, but there is less known about the supply side and the incentives for firms to provide these amenities. There are two main incentives for firms to offer family-friendly workplace policies. First, such amenities may increase employee retention or reduce the duration of labor market breaks following parenthood. Second, if some workers are willing to pay for these amenities, it can lower the firm’s recruitment costs. Our study uses matched employer-employee data from Germany to examine these motives, focusing on introductions of employer-provided childcare. We find that employer-provided childcare enhances retention and shortens labor market breaks for mothers. It also contributes to employment growth and increases the shares of females and mothers within a firm. These findings can be rationalized through a stylized model of imperfect competition in the labor market, where family-friendly workplace policies are modelled as an amenity with direct production benefits. Finally, we demonstrate that the availability of public childcare substitutes reduces the effectiveness of these firm-provided amenities.