How Maternity Leave Affects Female Employment in the UK?

Abstract

Maternity leave (ML) is the period during which a woman is legally allowed not to work during the weeks before and after childbirth. In the UK, the policy with ML not only includes a woman's legal right to take leave during childbirth, but also emphasises the right to receive financial benefit during the leave and return to work after childbirth. It is undeniable that ML allows women sufficient time to recover physically and psychologically after childbirth, and stay with their children. However, a body of evidence suggests that the impact of ML on women's employment is ambiguous. When the ML can encourage women to enter the labour market, the ML is also associated with lower wages for women, increased unemployment and reduced opportunities for promotion. Faced with this confusing evidence, how to clarify the impact of maternity leave on women's employment in the UK and how to find out the reasons why maternity leave affects women's employment becomes the main task of this study. After comparing the data for the treatment group (who would be affected by the law) and the control group (who would not be affected by the law) before and after the ML came into force. This study found that although the ML did not increase the wage gap between men and women, it discouraged women from entering the labour market, reduced female employment and was detrimental to women's wage development. Furthermore, the negative effects of the ML on women's employment can be attributed mainly to the too long leave duration.