Parental Leaves and Female Skill Utilization: Evidence from PIAAC

Most developed countries adopt parental leave policies to promote women's labor force participation without sacrificing family formation. Studies find that short-term parental leaves for women increase the time spent at home and promote their return to the labor force after childbearing, but some studies point out that long-term parental leaves hinder the career advancement of high-skilled women. This paper analyzes heterogeneous impacts of parental leave policies on women's skill-use intensity by skill level, drawing on rich information on individual skill and skill-use intensity available from the micro data of the Programme for the International Assessment of Adult Competencies (PIAAC), which covers 30 countries. The results show that longer parental leaves narrow the gender gap in skill-use intensity among low-skilled workers but widen it among high-skilled workers. This finding is robust after controlling for international differences in gender norms and labor market institutions and allowing for country fixed effects. The findings corroborate with the claim that a longer parental leave period suppresses the career advancement of high-skilled women.