Publication

This study provides causal evidence on the hiring and pay penalties associated with taking parental leave of varying lengths. We investigate how deviations from prevailing social norms, in the form of non-standard leave-taking behavior by mothers and fathers, affect their employment outcomes. We also compare the parental leave penalties with those linked to unemployment to disentangle the determinants of these penalties and to identify the mechanisms through which they operate. To this end, we conducted a discrete choice experiment with 997 managers, who evaluated hypothetical job candidates differing in the length of employment interruptions due to parental leave. Using a conditional logit model, we find that both mothers and fathers face disadvantages in hiring and remuneration when taking longer parental leave. Notably, fathers are penalized for taking any parental leave, though the penalties are more severe for longer leave. These poorer employability prospects stem from managers perceiving such fathers as less available for work. Meanwhile, mothers receive hiring and pay bonuses for taking shorter leaves, stemming from employer perceptions of such mothers as more available, competent, and motivated.