Not Only Mothers: The Effects of Family Policy on Women's Employment in China

Abstract

Background and Purpose: Women have been extensively found to be disadvantaged in the labor market due to their family care duties. To reconcile women’s work and family, state interventions, such as paid parental leave and funded childcare services, are widely exploited in post-industrial societies. This article aims to expand the knowledge by investigating this issue in China, where the recent fertility-oriented family policy reform makes the potential fertility encourage by the multi-child policy a critical concern of employers as well as a barrier to female employment, which is mixed with the entrenched familism and related social transitions and thus make China a unique case. Specifically, I examine how China’s maternity leave and funded childcare affect women’s wage, labor force participation, and occupational socioeconomic status, with an additional focus on childless women who might be affected by potential fertility.

Methods: data and samples: Combined datasets are employed in this research. At the individual level, we employ seven waves of panel data from the China Family Panel Survey (CFPS). At the macro level, we extract policy data from policy documents and official websites of the Chinese government. The focus of our analysis is on female respondents aged 16-45, including 23,409 women who were employed, and 32,563 women who were self-employed or unemployed.

Measures and statistical approach: Three outcome variables are of interest: 1) a binary variable reflecting whether the respondent was employed by an institution at the survey time, 2) the logged hourly wage of employed women, and 3) the occupational socioeconomic status measured by the International Socio-Economic Index of Occupational Status. Two main explanatory variables are utilized to capture China’s family policies, including 1) a categorical variable reflecting the duration of maternity leave and 2) the logged annual public spending per preschool student reflecting the provision of funded childcare. Control variables include parenthood, age and its square, education, marital status, residential status, household income, a set of occupational characteristics, provincial socioeconomic factors, and year dummies. The two-way fixed effect model is exploited to assess the policy effects.

Results: Findings show that extended maternity leave exerts negative effects on women’s wages and occupational socioeconomic status among all Chinese female employees, irrespective of motherhood. By contrast, the negative effect of maternity leave on female labor force participation is much less prominent. Furthermore, I find that funded childcare has a protective effect on women’s employment, although quite limited.

Conclusions and Implications: I conclude that family policy may influence not only mothers but all women due to the realized or potential fertility, thus affecting the gender disparity in the labor market to a broader extent. It is suggested that the natalist family policy makes potential fertility salient in the workplace and disadvantage working women. Therefore, I argue that more policy efforts should be made to socialize the cost of childrearing instead of imposing the burden on individuals, especially on women, and to offer employers incentives to hire women, such as tax deductions to offset costs generated by paid leave.