Child Care Subsidies, Employer-Provided Paid Sick Leave Eligibility, and Material Hardship

Background

There is a need for understanding how work-family policies, such as paid leave, interact with early childhood supports. While research has focused on the employment impacts of paid leave (Stanczyk, 2019; Ybarra et al., 2019) and child care subsidies (Kim & Henly, 2021; Marshall et al., 2013), fewer studies examine how these policies jointly influence material hardship (MH) for families. In this study, we examine how the relationships between employer-provided paid sick leave and MH may be moderated by child care subsidies. Findings contribute to improved understanding of how these supports work together (or fail to) in buffering MH for families with young children.

Method
We used data from Wave 1 of the Workforce Economic Inclusion and Mobility Survey (WEIM), a nationally representative survey of low-income U.S. workers administered across three waves from 2023 to 2024. The analytic sample (n=836) was restricted to parent-workers. MH was assessed through four indicators: food insufficiency, difficulty paying bills, housing hardship, and income instability. Paid sick leave was measured by self-reported eligibility from primary job. Child care subsidy usage was assessed by whether participants received government financial assistance to pay for child care in the past year.
We applied multivariate regression to describe employment characteristics associated with access to paid leave. Then, OLS regression models tested associations between paid sick leave eligibility and each hardship indicator. Interaction terms tested whether child care subsidies moderated these relationships. Control variables included were gender, marital status, partner’s employment, source and financial burden of child care, and yearly income.

Results

Preliminary results suggest that parents earning $60,001–$80,000 were more likely to be eligible for paid sick leave than those earning less (b=.53, p<.05), as were full-time vs. part-time workers (b=.43, p<.05).
Among the four MH indicators, paid sick leave eligibility was associated with lower housing (b=–.29, p<.01) and income instability (b=–.17, p<.01). Paid sick leave eligibility was not significantly associated with food insufficiency or difficulty paying bills. That said, women were more likely than men to report difficulty paying bills (b=.36, p<.05). Moderation analyses showed that child care subsidies significantly influenced the relationship between paid sick leave and housing instability: individuals eligible for paid leave but without subsidies were more likely to experience housing instability (b=2.79, p<.01) than those with both supports. No moderating effects were found for the other hardship indicators; however, identifying as female (vs. male) again predicted greater difficulty paying bills (b=.43, p<.01).

Conclusion

This study contributes to better understanding of how work-family policies interact with early childhood policy. Paid sick leave may help protect against certain forms of MH, but its effects are not consistent across all families. Without complementary supports like child care subsidies, the benefits of paid leave may be limited. These findings point to the need for coordinated policy strategies to support the financial stability and well-being of low- and moderate-income families.