The case against extended maternity leave

Maternity leave, be careful what you wish for. Photo by Doriana S.

Albania, Bulgaria, Denmark, Lithuania, Norway, Russia and Sweden are amongst the countries which allow a year or more of maternity leave. Hail to Albania, or is this blessing really a curse?

In the U.S., by contrast, through the Family Medical Leave Act, you can get a whopping 90 days IF you work for a company with over 50 employees and have worked for at least a year. But wait! Not only can you get up to 90 days, you get the privilege of not even getting paid while out on maternity leave, although many companies extend pay for women on maternity leave for competitive advantage.

In Canada, both mother and father can split the time of almost a year off with their partially paid maternity/paternity leave laws, although providences do vary.

The question is — are we getting royally screwed here? Do Americans generally hate babies? Are women still treated unfairly in the land of the free?

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While our dollar is becoming increasingly weaker, we are still one of the most prosperous countries in the world. According to the Department of Labor, almost 50% of all women over 16 years of age is employed. But before you call the wahmbulance and decry the unfairness of it all, consider this… according to The Local, an online Swedish news site, more Scandinavian and Nordic women work than U.S. women. But, the news site contends, Scandinavian women lack the success and prestige of higher paying jobs than their U.S. counterparts:

In major metropolitan areas in the US, such as New York, Los Angeles, Dallas and Chicago, young women have not only broken the glass ceiling, but in fact outearn men by up to 20 percent in average salary. One third of American women in the workforce outearn their husbands. Amongst unmarried people without kids above the age of 40, women earn considerably more then men.

Such successes are however not evident in Scandinavian nations, since a great share of women active in the labour market tend to work for the public sector. The possibilities for career development are limited in public sector jobs compared to the private sector. Also, wages are considerably lower. The dependence in public sector employment stifles women’s opportunities, not least for those with a higher degree of education.

Apparently maternity leave does not provide the best of both worlds, as many American women might mistakenly believe. Sweden offers up to 18 months of paid maternity and paternity pay, but it may be prudent to ask yourself, is 18 months really worth a lifetime of mediocrity at best?

The Local goes onto say:

The need to fund large public sectors has led to exorbitant tax wedges on services; up to 75 percent. Thus, it is difficult for professional women to buy household services and free up time for careers. Another effect of tax and transfer programmes is that both the need and the ability to accumulate personal savings are reduced. This helps explain why Scandinavian women have far smaller saving than their American counterparts, both in absolute terms and as share of national assets.

Furthermore, countries like the United Kingdom are now reassessing their generosity when it comes to maternity leave. While UK women have enjoyed 39 weeks of paid maternity leave for years, the government voted to extend that leave to 52 weeks, raising baby leave to a full year back in 2009. It was supposed to take effect in April of 2010. It never happened. In fact, the extension has been postponed indefinitely. Why? Because it’s unsustainable.

Want more proof that the grass is not always greener?

Of the countries that offer significantly longer maternity leaves, their GDPs pale in comparison to the U.S., with the low end being Albania whose GDP per capita is $7,400 compared to the U.S., which still has a GDP of $47,400 per capita. The exception would be Norway, with a GDP of $59,100 per capita, however, Norway has one of the highest costs of living in the entire world and is largely known as a “welfare state.” It openly practices redistribution of wealth. They also have a VAT (taxation of all items bought on the open market) of 25%. That means, everything you buy there is taxed 25% and on top of that, and you are taxed on your net worth, causing people to stifle their own success. It is one of the most taxed countries on Earth. A country that openly accepts and supports socialism, although the climate is changing. Even after all of this, Norway is finding itself moving ever so gingerly away from government controlled everything. All their eggs are in one basket. They rely almost solely on their oil exports. Should an alternative fuel become viable, they would be colossally screwed.

For all the praises that are sung for nations like Sweden and Norway, and their extended maternity leave and baby initiatives, one has to consider all the facts. Is it because these extended-baby-leave countries love mothers and babies so much more than Americans or is that these countries actually have less confidence in women as productive members of society? If women are only getting these extensions because the country they live in only allows them opportunity as mothers, then no thanks. I’ll take my 9 to 5 as a working mother. I actually enjoy it.

The Local concludes their article:

The 40 percent goal has been hailed in international media as a success, but few have reported the problems created for Norwegian companies. In part because the welfare system reduced the number of career women in the private sector, it has not proven easy to fill the board seats. Norwegian firms desperately attempt to find female board members, going so far as actively recruiting women from neighbouring countries to fill the quotas.

Perhaps even more disturbing is the fact that the law in many cases resulted in firms filling their seats with politicians, in many cases those very politicians who pushed the quota legislation to begin with. There is no tangible evidence that the rent seeking board quotas have had any beneficial effects for Norwegian women in general.

Scandinavian cultures have for long been famous for their general egalitarianism and for their equality between the sexes. But it becomes increasingly clear that the opportunities of women in the private business sector are stifled by welfare policies and government monopolies.

Would you be willing to give up much of your net worth and career opportunities for women to take a year to a year-and-a-half off of work to have a baby?

Talk about a meal ticket.