The Example of Employer-Supported Childcare
The author asks how far the extension of employer-supported childcare serves as a driver for higher maternal labor supply. She addresses this question by categorizing employer-supported childcare as an efficiency wage introduced by the employer to increase the working volume of mothers. Applying various impact evaluation techniques in an econometric analysis, the author concludes that the availability of employer-supported childcare has a positive impact on the length and working volume of mothers who return back to work after giving birth. Furthermore, the usage of employer-supported childcare by mothers with pre-school age children influences the amount of agreed and actual working hours positively.
3. Literature Review: Determinants of Maternal Labor Supply
The following chapter aims to present a widespread overview of determinants for maternal labor supply. Therefore, distinct categories offer insights on several factors as well as possible degree of interdependencies between single categories. Several factors emerge as additional explanations in several sections. The literature review focuses on Germany, but studies from other countries are complementarily used. The section on ESCC describes – next to the effect on the working volume – the effects on the working attitude.
Household income and marital status of a mother are usually addressed in union when discussing maternal employment, making the monetary aspect of the partnership a main focus of the investigation. Having a partner who earns more decreases possible financial pressures for non-working partners. On the other hand, social benefits from the state for the partner also may affect women’s employment participation and work hours. In Germany, this is especially interesting due to the spousal tax splitting (Ehegattensplitting) (see section 3.4.2. “Taxation law”). The individual income of a mother has a different interpretation compared to the household income. In Germany, couples may tend to regard their incomes as joint income. In contrast to other countries, salaries may be interpreted as each partner’s individual contribution to the common disposable income. Thereby, the common income “is converted into resources such as domestic work or recognition” (Ludwig-Mayerhofer, Allmendinger, Hirseland, & Schneider, 2011, p. 367).6
Ziefle and Gang (2014) analyze that mothers’ employment rates in dependence on the partners’ income differ significantly between mothers living in former East and West Germany. In West Germany, long labor market interruptions after childbirth tend to depend on whether the partner has higher earnings, no earnings, or if he is self-employed. Especially in case of unemployed partners, the mothers try to compensate the missing income with higher employment rates. A medium earning does not seem to influence the employment rates positively or negatively. Among East German mothers, maternal employment does not depend on the income of the partner. Focusing on the re-entry to work after childbirth, Hoherz (2014) demonstrates that men’s resources have a significant impact on the decision to ← 59 | 60 → return to part-time work. She argues that on the one hand, partners with a larger income provide less financial motivation to return to the labor market, but that on the other hand, husbands with greater financial resources generally exercise more power within the family and feel less obliged to do housework or take on childcare responsibilities. With regard to a return to full-time work, Hoherz concludes that the financial resources of the partner play less of a role in the decision. Instead, the intrinsic work motivation seems to be decisive here.
During the years 2006 to 2012, there was a program called “Pro Kind”. It aimed at improving families’ economic self-sufficiency and family planning. The target group were pregnant first-time mothers and/or their partners who received social welfare or unemployment benefits, had an income that qualified them for social welfare benefits, or had excessive debt. Sandner (2015) concludes that the program decreased maternal employment, but increased life satisfaction and fertility rates. He argues that the program increased mothers’ knowledge of welfare spending. Mothers, in other words, did not regard employment as their main financial base, but the welfare state support.
The marital status is a further determinant of maternal employment which might influence the employment status positively or negatively. Generally, labor market attachment of single mothers is sometimes reported to exceed those of partnered mothers (BMFSFJ, 2009). This is observable for mothers who have teenaged children (BMFSFJ, 2012a). Focusing on single motherhood, two different lines of argumentation may be applied. Due to the missing second income, single mothers may have to deal with tighter budgets, which may force them to work rather than leaving them with a choice. It is also possible that single mothers who are eligible for a broader spectrum of social benefits are discouraged to work since the lack of income is offset by the benefits (Kreyenfeld & Hank, 2000). Having a closer look at the differences between single mothers in former East and West Germany, there are visibly more single mothers living in former East Germany (27 percent) compared to former West Germany (17 percent) in 2009. Jirjahn and Struewing (2015) examine two distinct groups of single mothers, those having out-of-partnership births and those having separated from their partner while their children are young. Here, single former East German mothers have greater likelihood of giving birth outside of partnerships compared to former West German mothers. In a similar vein, separation rates of parents to young children are higher in former East Germany as well. The authors explain this by noting cultural differences in love or partnership. Improved childcare facilities in East Germany, which allow mothers to reconcile family and work, or lower earnings, are not regarded as significant influences.
Hancigolu and Hartmann (2014) assess which determinants are more influential for entering employment after becoming a single mother. In general, they state that many women reduced their labor market participation shortly after becoming a single parent, but most can manage it over time. They regard the institutional ← 60 | 61 → factors, like special benefits for single parents, as most decisive for employment decisions. Education is more importantly compared to the age of the mother in terms of individual factors. For mothers who do not need to rely on public childcare, transition into re-employment or an increase of working time is much more likely. Thereby, the role of informal childcare, especially of grandparents is elevated. Using the same dataset, Zabel (2015) tries to identify individual characteristics that may predetermine employment modes single mothers. Contrary to Hancioglu and Hartmann (2014), Zabel regards the mother’s age as a variable: Entering single motherhood at a young age is associated with longer periods of non-employment. Regarding the education, she hints, a vocational qualification sets up mothers for part-time employment, whereas a higher education offers full-time employment, arguing in effect alongside Hancioglu and Hartmann (2014). The latter mentions a higher education as showing a strong link to full-time employment if the children are at school age; this observation, however, cannot be confirmed for vocationally educated mothers.
In another study, Zagel (2014) compares former West Germany and Great Britain. She highlights the importance of part-time jobs in the German economy as a way to return to work as a single mother. Across the board, labor market attachment of German mothers is higher than compared to British mothers. German mothers stick more continuous to one kind of employment, for example part-time, while British mothers tend to switch between different kinds of employment over the life cycle. Zagel (2014, p. 9) states that “trajectories are relatively predetermined” in Germany. Hence, if ESCC might support the return to work after childbirth positively, this might have positive long-term effects.
Zabel (2012) observes that participating rates do not differ between lone mothers and childless single women. Moreover, participation rates of partnered mothers from former East Germany are nearly as high as for single mothers. In contrast, the participating rates of former Western German coupled mothers are significantly lower compared to lone mothers or childless singles. With regards to the effects of participating in the programs encouraging employment by the government, Zabel (2013) observes for lone mothers that they benefit especially when they participate in vocational training. However, workfare, which is designed to increase participants’ motivation for job search, does not inhabit a positive effect on the labor market participation of single mothers. Zabel regards missing childcare facilities instead of missing motivation as the primary reason.
Maternal employment depends on several characteristics of children. Preliminarily, the age and the amount of children dominate the decision to regain employment after childbirth. The gender of children does not seem to be influential here. Sommerfeld (2009) observes that maternal labor supply increases significantly with the age of the children. More specifically, it seems that other factors, for instance education or income, do not matter until the child has reached the age of two. Mothers ← 61 | 62 → appear to be increasingly responsive to economic matters as the child is growing. First-time mothers do not reveal a significantly different behavior compared to mothers with children between four and six years, only for the age of two. This observation could be explained by the fact that mothers with a child between four and six already spent about six years outside the labor market, allowing them to re-enter employment more frequently or with more working hours compared to mother with a younger, older or no child.
There appears to be a strong relationship between maternal labor supply and the number of children. Whereas mothers with one or even two children still try to work while raising children, three or more children change this ambition. While 23 percent of mothers with one child do not work, it is 28 percent of women with two children, and nearly 50 percent of mothers with three or more children. Thereby, a significant relationship can be identified for the education. For all three groups, the likelihood of being employed raises with the educational level (Keddi, Zerle, Lange, & Cornelißen, 2010).
In this section, the influence of the employment mode of mothers will explore the kind of occupation, qualifications, previous career development, and individual income of mothers. Women with a high qualification in terms of an academic degree tend to also have a successful career development in terms of promotions, allowing the conclusion that this is a cause-and-effect model. However, the components do not always go hand in hand; for instance, it might be that women started to work at a younger age with a vocational education and experienced promotions before becoming mothers, differing from women with a higher education and a later start into work life.
The type of occupation can affect maternal labor supply in two ways: certain occupations have specific conditions affecting the duration of a career break and some mothers may have to, depending again on specific related requirements, decide to or be forced to change their occupations after giving birth.
Concerning job characteristics, Stuth, Hennig and Allemndinger (2009) investigate sets of preconditions affecting women in different ways especially after giving birth. They differentiate between 111 groups of occupations. They focus on the last job the women worked in. Their results highlight that the type of occupation is a major factor when deciding whether to return to the job, controlling for exogenous factors like the economic cycle, change within the economic sectors, and the age of mothers.
The results suggest that a greater amount of working hours (for instance 46 or more hours as a hairdresser) increases the duration of career breaks. Occupations such as professional chef, who often are monotonous, repetitive, heteronomous, and ← 62 | 63 → physically demanding also have rather long career breaks. The opposite effect seems to be in place for occupations which imply work on Sundays and public holidays, for instance waiters. These jobs allow for flexible and self-determined work schedules and shorter leaves (Stuth et al., 2009). However, not only the working conditions are decisive. Arntz, Dlugosz and Wilke (2014) highlight that less-educated women or women working in atypical employment modes have shorter work interruptions. Additionally, Arntz, et al (2014) demonstrate that occupations marked by a high degree of complexity have a higher probability of returning back to their previous employer in full-time and without a job change. Busch-Heinzmann (2015) describes that there is a significant amount of women changing from gender-atypical to gender-typical occupations over their life time. Lutz (2016) supports this observation by highlighting that psychological strains in the job increase the likelihood of changing the occupation. One exception concerns women with a psychologically intense occupation and an extraordinary income. They are likely to stick to their original job.
Further, the level of education of the mother and her career development before giving birth influence the maternal labor supply. Kreyenfeld and Hank (2000) reason from the sociological perspective that the working attitude of high-level educated women is different than the one from lower educated women. They argue that higher educated women more often enjoy their work and work by choice. They also refer to the economic perspective by emphasizing that higher educated women are more likely to participate in the labor market since a high education is often associated with a higher income. On the other hand, it is observed that mothers with a low income are often forced to work to be able to maintain their standard of living, yet this observation shifts with the level of income of the partner (Spieß, 2011).
Konietzka and Kreyenfeld (2010) conclude that there is an educational divide growing over the last thirty years in Germany. As it has been demonstrated in section 2.1 “Male, female, and maternal labor force participation”, a raise in maternal employment rates went along with a decline in total full-time employment. The authors argue that it is at odds with conventional wisdom that it was more common to be full-time employed for mothers during the 1970s than it is nowadays. Regarding education divides, the full-time employment rates decreased for all educational groupings. However, the strongest decrease has been perceived by less educated mothers. Increased part-time employment, including marginal employment, reinforces the findings in regards to growing education disparities. Part-time employment as the most widely spread of employment-model is highly stratified by education. The authors argue that the employment possibilities have been steadily worsening over the last three decades. Simultaneously, the welfare state supported incentives for mothers to focus on child raising. The authors demonstrated that parental leave policies have been utilized predominantly by less educated women, while higher educated mothers benefit from a range of possibilities – and likely a ← 63 | 64 → strong work motivation – to sustain their careers. These policies have been promoted as providing a choice to mothers. As a consequence, the authors conclude that the dual breadwinner model is socially selective in Germany, leading to an increasing inequality in the future. These findings are supported by Drasch (2013) who examined that, remarkably, mothers whose children are born from 1992 onwards show a growing educational divide due to work interruptions. She argues that the leave duration that is related to the job guarantee seems far more important than the financial compensation of the leave.
Coming to the career trajectories, Fitzenberger, Steffes and Strittmatter (2015) use data of a great German financial company to assess the return-to-job characteristics of a mother after giving birth to their first child. In comparison to studies mentioned beforehand, this study analyzes the research question with data from only one company, focusing on the stability of employment after the job-return as well. For example, the parental leave system currently gives high incentives to have a second child, since benefits are means-tested, meaning dependent on the previous salary. If a mother has a second child while still being eligible to base her benefits on the salary before her first leave, she mostly receives higher funds than compared to the salary after the first parental leave. In short, their results indicate that the relative wage position, higher tenure, and an above average frequency of previous promotions, show a positive association with the return-to-job and the stability of employment after return. However, the authors argue that the assumption that mothers with a higher salary, a high educational degree, or an average frequency of promotions in comparison, do not foster the return-to-job at all. In terms of the qualification, they reveal that a combination of academic and vocational education shows the greatest working time after childbirth. Female workers do seem to get their first child at a specific time during their careers. These results suggest that a sizeable fraction of mothers with a successful career before first birth do not engage in similar career advancement after the first birth and have a probability of not returning to their job. This is especially hard for the company if they ‘lose’ female employees with a great amount of firm-specific human capital. A shortcoming of Fitzenberger, Steffes and Strittmatter’s study includes that they have no information on the marital status or household income, albeit above research shows correlations. Hence, some of their results might have to be adjusted if including this information.
Arntz et al (2014) conducted a similar analysis. They make one additional observation: there is an increased likelihood that women who have recently been demoted in the salary distribution deliver their second baby during the reference period of parental leave policies. Thus, it is likely that they return to their previous employer after a substantial period of work interruption. In comparison, women who were recently promoted before giving birth are more likely to change their employer. It follows that they perceive that they have options to improve their position on the job market. ← 64 | 65 →
The subsequent section will investigate the role of ESCC for maternal labor supply. Since there is just a limited degree of studies on ESCC in Germany, international papers are included in the literature review as well. However, it should be noted that the comparability is relating to nation-specific circumstances (see section 18.104.22.168. “Outlook on employer-supported childcare”). Several studies do not explicitly focus on mothers, but on all employees. Studies with this work’s explicit target group of mothers are rather rare. This section focuses on the relationship between work and ESCC. In the discussion, other effects of ESCC will be addressed as well (for instance work commitment or intention to stay in the company). All papers on ESCC are listed in Appendix A: “Overview on impact of ESCC on work behavior.” Since the focus of this thesis deals with the effects of ESCC on maternal labor supply, the following outcomes are discussed more extensively compared to the remaining literature review.
There are currently two papers dealing with the evaluation of corporate childcare in Germany explicitly. While the first evaluation focuses on the pedagogic effects, the second one estimates the financial benefits for the state, the company and the parents.7 Both studies discuss corporate childcare’s effects on employment rates. The evaluation of the kindergarten “Kids & Co” hosted by the Commerzbank presents that in 2004 and on average mothers returned to work approx. 30.6 months after childbirth. Mothers giving birth in 2007 returned after 19.3 months (Commerzbank AG, 2010). The study presents statistics; therefore it is unclear whether the earlier return-to-job dates are due to the introduction of “Kids&Co” or something else like the introduction of the parent’s money reform in the same year. The report on the kindergarten “LuKids” of BASF estimates that “LuKids” parents work on average three months more than non-“LuKids” parents do ”by applying a matching approach (Then, Münscher, & Stahlschmidt, 2014, p. 25)”8. However, it is not clearly stated if they estimate it for a specific time span, for instance for the first three years after childbirth, nor do they supply information on the amount of working hours. The provided data in both studies go in the same direction, but the shortcomings muddy exact results for the task at hand.
There exist several studies on the relationship between ESCC and employment rates for the USA for the 1980s and 1990s. During this time, tax deduction policies ← 65 | 66 → on childcare were implemented, explaining the wealth of literature emerging (see section 22.214.171.124 “Outlook on employer-supported childcare”). Divine-Hawkins and Collins (1983) observe the effects of childcare programs focusing on information and referral, flexible benefits, vendors, vouchers, flexible spending accounts, on-site and near-site childcare centers, and in-home childcare. Their survey among 415 employees revealed that around half the parents would increase their working time if the ESCC allowed it. One-fifth of the respondents said that it would not affect their employment decision. Lehrer, Santero, and Mohan-Neill (1991) observe the effects of ESCC in the working hours of nurses with childcare obligations, again in the USA. As one of the few studies on this topic, the authors focus on individual characteristics influencing the decision to increase labor supply when ESCC is provided. Thereby, nurses with a lower wage increase their working hours most likely when offered ESCC. These nurses increase their gross hourly wages by approximately $ 2.00. Other individual influential characteristics concern the marital status, as non-married mothers increase their labor supply more. Thereby, it does not matter whether the mother is single, widowed, or cohabitates with a partner. Mothers with more than two children are more likely to increase their working hours compared to mothers with one child.
Nowak, Naude and Thomas (2013) conducted a qualitative interview with 388 female employees in a health department in Australia, in regards to the time after birth at which they return to the workplace. The respondents again confirmed an earlier return should their employer offer appropriate childcare facilities. They highlighted amongst other necessary accommodations the availability of rooms and an appropriate work schedule to breastfeed. Otherwise, they do not regard company support as helpful.
The only study comparing the different effects of on-site vs. voucher childcare assistance is pursued in the USA, by Gullekson, Griffeth, Vancouver, Kovner and Cohen (2014). They investigate vouchers as one solution to reduce the cost of childcare assistance without reducing the benefits to the organization. The basis for this comparison is that companies regarded on-site childcare as too expensive due to high fixed costs. Using personnel data from employees in a hospital, the authors conclude that there are no differences between employees using the two programs to the extent to which the employees reciprocate to the organization. More specifically, there were no differences in the programs’ administrators’ perception of the programs’ ability to increase retention, improve recruitment, or decrease absenteeism. However, their results have two important shortcomings: they have a very small sample size which cannot be regarded as representative, and they cannot differentiate between men and women due to the small sample size. Differentiating between both genders can influence the results substantially, since it can be expected that women respond heavier to child policies than men.
Anderson and Geldenhuys (2011) operationalize LFP in a different way. For South Africa, they analyze the impact of on-site childcare on absence. Having personnel records for one company with on-site childcare and another company without childcare, they are able to differentiate between absence frequency (total number ← 66 | 67 → of times absent), absence severity (total number of days absent), attitudinal absence (frequency of one day absences), and medical absences (frequency of absences of three days or longer). Regarding the frequency of absenteeism, the total number of days absent, as well as the annual number of days absent, those employees without access to an on-site facility showed significantly higher absenteeism rates than those with such access to an on-site facility. The authors do not address differences between facility users and non-users, stating that “employees might experience the employer as taking care of employees by making provision for child-care, even if they do not make use of the benefit” (Anderson & Geldenhuys, 2011, p. 40). The authors cannot differentiate the results for mothers and fathers, but highlight that female parents generally have higher absenteeism rates.
Section 2.2. “Maternal working preferences” demonstrated that there is a divergence between actual maternal employment rates and the preferred working volume. This divergence might still be prevailing in case of provided ESCC since there are factors outside the power of employees determining the amount of working hours (Ehrenberg & Smith, 2012). Therefore, this part of the empirical analysis will focus on further effects of ESCC next to the narrow definition of maternal labor supply presented in the previous sections. All studies cited in this thesis on ESCC are listed in Appendix A.
Barel, Fremeaux and Michelson (2010) investigate the relationship between potential work-family conflicts and the provision of employer-driven childcare incentives in France. In their study, they do not differentiate between employees with and without childcare obligations as well as mothers or fathers. Nevertheless, they argue that the childcare policies do not guarantee a positive impact if a range of individuals and family constraints hint towards potential work-family conflicts. Furthermore, the perception of the work organization and the role of the employing organization are important. Corporate childcare seems to be able to decrease a work-family conflict if it takes employees constraints into account and inhabits a flexible approach. The authors derive the following conditions which should be fulfilled when ESCC will be effective in reducing a work-family conflict. Firstly, the policies need to be tailored to the real needs of the employee and the organization. Secondly, it must be designed in a way that as many employees as possible benefit from it. Thirdly, it shall consider the personal constraints, for instance day-to-day changing capacities depending on the working time. Ezra and Deckman (1996) differentiate as the only study between mothers and women without childcare obligations. Likewise dedicated in the field of work-life balance in the USA, they find out that the mothers show a significantly higher childcare satisfaction compared to non-mothers due to ESCC, which in turn influences their work satisfaction as well as commitment. One quarter of the mothers who are currently working in companies without on-site childcare were interested in being offered it. However, three quarters do not see an additional benefit compared to their current arrangements. Feierabend, Mahler ← 67 | 68 → and Staffelbach (2011) investigate whether there are spillover effects of childcare support on employees without childcare obligations in Switzerland. These policies only have a specifically positive effect on the life satisfaction of employees with childcare responsibilities. Regarding spillover effects, a family-supportive dialogue and culture both reduce the intention to quit and enhance the organizational commitment of the entire workforce – whether or not there is a direct benefit to the employees. Especially the last results are supported by Grover and Crooker (1995). They analyze the effects of ESCC in form of information sharing and assistance in costs and find that employees showed significantly greater organizational commitment and expressed significantly lower intention to quit their jobs. Especially it is highlighted that all employees showed greater attachment, even those who do not benefit. Taking the life-course perspective, Roehling, Roehling and Moen (2001) highlight that ESCC inhabits a positive influence on the loyalty of women with school-aged children and older women with no children in the US. A stronger effect of ESCC on loyalty could just be accented through informal support by supervisors. The authors explain the nonexistence of a relationship between ESCC and women with pre-school children by the fact that the regular school for school-aged children is more time-invariant compared to care for pre-school aged children.
While the previous studies focused on the aggregation of several different kinds of ESCC or explicitly on on-site childcare, Morrissey and Warner (2011) focus on the effects of childcare voucher at a large university in the US. Although demand-side vouchers appear to be a promising employer approach to address childcare challenges of employees, the results suggest that attention must also be given to the structure of childcare supply as satisfaction and work-family stress are affected by more factors than childcare cost only. Lehrer et al (1991) examine that increased attachment due to ESCC to the company is especially high for nurses in the US. The nurses highlighted that they regard on-site childcare as very supportive to combine work and family. Remarkably, they mention the possibility of checking the quality of the care institutions more frequently compared to public childcare facilities since they are able to go there during breaks several times a day.
Goff, Mount and Jamison (1990) do not find a relationship at all between ESCC, work-life conflict and absenteeism of employed parents in the US. However, exceptional to the above-mentioned studies, they use personnel data of a company. While an individual company might be marked by a distinct working culture or HRM, the effects might be less comparable to the results of representative datasets. Using personnel data from a university in the US as well, it is shown that employees using on-site childcare were less engaged in and satisfied with their jobs when they either perceived their organization to be unsupportive toward their family life or were dissatisfied with their childcare provider. The authors argue that the provision of on-site childcare must be supported by an open working climate which supports the employment of parents (Ratnasingam et al., 2012).
The effect on a further outcome variable is examined by Casper and Buffardi (2004) for the US. They investigate in how far the provision of ESCC increases the intention of an applicant to apply with a company. According to them, dependent ← 68 | 69 → care assistance is positively related to job pursuit intentions as well as anticipated organizational behavior. Grover and Crooker (1995) conclude that non-users value it while Divine-Hawkins and Collins (1983) conclude that non-users do not value ESCC and partly say that spending money on ESCC is waste of money. Barel, Fremeaux and Michelson (2010) agree to this finding by stating that it does not matter for applicants and job-searchers whether potential employers offer ESCC at least in France.
A different perspective is emphasized by Hoobler (2007). According to her analysis, family-friendly HRM, particularly ESCC, reinforce gender biases that degrade women’s status at the workplace because women are the primary users of on-site childcare service. For instance, it might be that the women would use their lunch break to see after their children since they have the possibility to do so. Consequentially, (male) colleagues might consider this behavior in a deprecatory way. Rather, public family-friendly policies should be promoted.
Several studies have revealed that the effect of on-site childcare on the overall workforce perishes independent of the specific outcome variable. Three reasons have been identified for this (Rothausen, Gonzalez, Clarke, & O'Dell, 1998). Firstly, it might be that on-site childcare is too insignificant to affect the overall workers attitudes and behavior. Perhaps it is the totality of the family-friendly benefit package which may cause backlash, not just one benefit. The authors conclude that “family-friendly backlash may be more a media-sensationalized issue than a real one” (Rothausen et al., 1998, p. 701) since the topic as itself acquires large media attention. A second alternative is that although equity- and equality-based allocation rules may dominate in general in work environments, some specific issues, like employees’ family issues, may elicit a more needs-based allocation value. The authors rejected the hypothesis that equity and equality-based norms exist in the workplace. The failure to support the statement could suggest that needs-based allocation values may exist in organizations with respect to on-site childcare. The welfare of families and of the next generation of citizens and workers may be affected by organizational work-family policies. Hence, strong family-supportive policies in organizations may affect future outcomes for society as a whole (for instance, crime, poverty). Thus, it may be that workers generally view family needs as legitimate reasons to use need-based allocation in the workplace. The third explanation refers as well to the equity-based allocation value. Childless employees may see the center as benefiting them because without it employees with children would likely be absent more or work less overtime, thereby possibly increasing childless workers’ workload. This effect may overshadow any possible resentment of the benefit dollars that are being spent on workers with children.
Altogether, it seems that ESCC can, but does not necessarily have to affect the work behavior in a positive manner. Outstandingly, ESCC seems to be valued more profoundly if job applicants or new employees are asked for it compared to the core employees. ← 69 | 70 →
This section addresses the impact of other HR policies next to ESCC on the employment rates of mothers. Thereby, the policies of interest are home office, job sharing, and flexible working time arrangements.
About 55 percent of mothers with children below three years of age are able to use flexible working arrangements; the percentage is the lowest for mothers working more than 36 hours per week with 45 percent. On the contrary, 66 percent of mothers working 25 to 30 hours use it. Home office is used by 25 percent of all mothers with children below three years. Here, the highest value can be found by the group of mothers working more than 36 hours (30 percent) and the lowest value has the group of mothers working 15 to 19 hours per week with 12 percent (Lauber et al., 2014). Flexible working time is one reason why self-employed mothers are returning faster to work and with a higher work-volume compared to employed mothers (Schreyer, 2015). Several authors (Brenke, 2016; Weßler-Poßberg, 2014) investigate that home office use is generally marked by low usage. While the amount of employees working regularly in home offices was at approximately five million in 2008, it decreased to approximately 4.2 million employees by 2015. Generally, home offices are overwhelmingly used by male and junior employees. It is remarkable that it is more often used by employees without a partner. Weßler-Poßberg observes that single parents often regard working in home offices as additional stress. She concludes that working from home cannot be regarded as an instrument for the reconciliation of family and work, but rather as strategy for performance-oriented employees as it is mostly used by employees with a higher degree of education. The last statement is supported by Brenke.
Job sharing is defined as a full-time job which is pursued by two or more employees in part-time. The tasks of the job do not allow a single part-time situation. This model is used by employees who would like to pursue their career plan while raising a child. Within the international context, the proportion of Germans working in job sharing is rather low, only 15 percent in 2014. The use of job sharing opportunities in other countries examined is as follows: Great Britain, 48 percent of employees, in the Netherlands and Belgium 23 percent, and in Austria 22 percent. Eberhard (2015) analyzes whether job sharing leads to a happier life situation since the reconciliation of family and work is improved. Unfortunately, she does not differentiate between male and female job sharers. Her results indicate that 90 percent of the participants say that they indeed improved the reconciliation of family and work, and 40 percent did not see their careers suffer as a result. However, just 35 percent of the participants felt more productive, since arrangements with their job share partners are often extensive.
Two thirds of the mothers argued that they needed more than one HR policy to reconcile family and work. Although they do not use all of them always, the possibility of relying on them is important (Weßler-Poßberg, 2014). ← 70 | 71 →
The working environment is an influential factor for maternal labor supply. Welteke and Wrohlich (2016) analyze whether peer behavior and social norms at the workplace play a significant role for maternal employment. The authors found strong evidence that women with female co-workers who returned to work early will do the same, explaining differences in maternal work-related decisions not only on national levels or private family characteristics. Having established that work environment clearly affects decisions, the following investigates which factors might be of interest in an analysis of the work environment.
Arntz et al. (2014) demonstrate that mothers who are employed in a firm with a great amount of female employees have a higher probability of delivering a second child, but are less likely to return to full-time work. According to their findings, a working environment marked by a large share of women puts less long-term penalty on working part-time or extending parental leave. On the opposite side of the spectrum, mothers working in a company with a very young average age are more likely pushed to find a new employer when they have a second child, as companies with a young workforce have a high degree of employees without children and rarely emphasize the reconciliation of family and work. The authors reveal that mothers working in small companies are less likely to return to their employers compared to women working for larger businesses. This might be dependent on HRM, usually more established in larger companies, and those offering part-time opportunities.
Work schedules are equally important in considering returning to work. Shift work for example inhabits the likelihood of returning to full-time work. Mothers are less likely to get their second child while being in parental leave, as well. And mothers in jobs that had high risks for over-time return to the workplace in part-time employment (Arntz et al., 2014). It is worthwhile to state that the availability of formal childcare reduces nonstandard work among parents and enables parents to work standard schedules. Considering how nonstandard work schedules are negatively associated with child well-being, access to formal childcare protects children from the adverse effects of their parents’ evening and night work. Lastly, considering economic sectors, Weßler-Possberg (2014) compares family-friendly working attitudes in the private and in the public sectors. In 1994, the German constitution was reformed to include explicit sections on equal rights and the support of female employment in the public sector. In the private sector, efforts to legally require equality have not come to fruition, except for the introduction of a women’s quota in 2015 (see section 2.1. “Male, female and maternal labor force participation”).
The welfare state affects the maternal labor market attachment in so far as policies can increase or decrease incentives to work. Welfare state policies can be divided into four main categories: monetary benefits, taxation benefits, subsidies of ← 71 | 72 → childcare, and social insurance related benefits. The interaction between the categories can have counter-acting or supporting effects. The following first explores the individual categories before analyzing any possible effects on the employment rates of mother.
Since Germany, and especially the former West Germany, is commonly known as a rather traditional country in the sense of maternal LFP, it makes sense to look at the history of German maternity-leave policies. Since the ESCC can be regarded as a very proactive policy to keep mothers in the labor force, it should be seen in context of the development of maternity leave policies. The second sub-section deals with the effects of these policies on maternal employment.
The starting point for West Germany’s direction of the maternity policies began with Bismarcks’s social question (Arbeiterfrage) at the beginning of the 1880s. He introduced a mandatory and occupation-related insurance system. This system was not only valid for the principal earner, but also for his dependents securing the worker as well as his family (Leibfried & Obinger, 2003). According to a law introduced in 1878, women giving birth were obliged to interrupt working for three weeks unpaid. In 1952, the policy was extended to twelve weeks called the maternal protection law (Mutterschutzgesetz). In 1979, working mothers could stay home for six months with a payment of 750 German Marks (around 380 Euro) according to the optional maternity vacation (Mutterschaftsurlaub). Both policies were “explicit financial acknowledgment of their right to care” (Erler, 2011, p. 112). However, fathers were implicitly excluded from them. Set into force by the governing Social Democratic Party (SPD), the Christian Democratic Party (CDU) disapproved them by stating that they limited the freedom of choice for women staying at home and taking care for the children.
A turning point happened in 1986 by publishing the parental leave law (Bundeserziehungsgeldgesetz) since it included fathers as well as working and non-working mothers. This law inhabited that parents had a six month-long mandatory leave period plus optionally a ten month-long leave period. Both time frames were paid with 600 Deutsche Mark (around 300 Euro). Furthermore, parents were allowed to work part-time (19 hours) per week. The goal of this reform was the facilitation of entering the labor market afterwards. Nevertheless, the governing party did not aim at extending public childcare facilities. Hence, the law was still in line with the goal of supporting the choice of being a housewife. In 1986 and respectively in 1992, the leave periods and their payments grew to 24 and 36 months. Non-governmental ← 72 | 73 → organizations as well as the opposing SPD agreed with these laws by the governing CDU. Nevertheless, the SPD criticized that the non-extension of childcare opportunities were hampering a “more gender-equal combination of work and family responsibilities” (Erler, 2011, p. 123). The opinion was supported by various evaluation programs concluding that just a very small amount of fathers took parental leave and many mothers did not decide to gain employment again.
In comparison to former West Germany, maternal employment was strongly supported in former East Germany. Politicians encouraged full-time employment due to the socio-economic situation. Simultaneously, the politicians tried to achieve full reproduction of the population. To achieve this idea, free public childcare facilities were extended covering close to 100 percent. Furthermore, the government offered curtails of credit after giving birth or payments to interrupt working for one year. However, strong political and social pressures influenced mothers decisions to return to work. Not surprisingly, former East Germany had one of the highest working mothers rates in the world with 91.8 percent in the year 1988. However, reasons like the unequal distribution of housework or disadvantages at work of mothers lead to a decrease of the fertility rate from 2.1 children per women in 1971 to 1.7 children in 1989 (Erler, 2011).
The unification of former East and West Germany in 1990 included the union of two different approaches concerning child raising. The negotiations ended with the bilateral unification contract (Einigungsvertrag), which highlighted on the one hand the protection of the public childcare facilities in former East Germany and the hint for West Germany to work on policies to reconcile work and children (Felfe & Lalive, 2010). In the upcoming years, the “lack of political will to tackle the complex issue of intra-households role models” (Erler 2011, p. 124) and the importance of the economic situation of former East Germany neglected family politics.
In 2001, the child-raising benefit (Erziehungsgeld) was published. It included the aggregation of some minor reforms. Firstly, the leave could be taken by both parents at the same time. Secondly, parents could choose to take twelve months of the leave during a period of eight years. Thirdly, part-time work was allowed up to 30 hours a week. Fourthly, parents were able to decide between 300 Euro per month over a period of two years or 450 Euro per month over a period of one year. Fifthly, the governing SPD reduced the income ceiling from Euro 51,130 to Euro 30,000 for the first six months. This decision was justified due to the economic situation since it included a lower number of recipients (Erler, 2011).
The importance of family politics grew in the upcoming years due to the political, social and economic situation of Germany. Firstly, the old age pension system as well as the health system suffered from low fertility rates from the 1970s on in combination with population aging (Erler, 2011). Thereby, university graduates had with on average 1.3 children lower fertility rates compared to lower educated women (1.7 children on average) (Henninger, Wimbauer, & Dombrowski, 2008). Furthermore, a great dissatisfaction with the reconciliation of work and family resulting in low maternal employment rates as well as great salary gaps between men and women led to a change in the course of family politics (Auth, Leiber, & ← 73 | 74 → Leitner, 2011). In 2005, the governing party changed from the SPD to the CDU. This change in government lead to a new direction in family politics, leading to the reform of the parent’s money in January 2007. This major law had three main aims. Firstly, fatherly participation in child raising should be raised. Secondly, parents should not have any financial pressures in the first time after childbirth to be able to focus on it. Thirdly, mothers should enter employment afterwards easier (Wrohlich et al., 2012).
The type of transfer differed substantially between the previous child-raising benefit and the upcoming parent’s money. As a means-tested program, a family had Euro 300 for two years when they had a net income of Euro 30,000 or respectively Euro 23,000 as a single parent. If their income was higher, the parents received nothing. On the contrary, as an earnings-related system, parents receive two thirds of the income they earned before giving birth. Thereby, the lowest benefit was Euro 300 for no income and the highest benefit was maximum Euro 1800 per month. Additionally, a low income part is considered to differentiate between non-working parents and low income parents. While the old system was valid for two years, the new reform included benefits for one year. Under the new system, parents were able to opt for a benefit for a period of two years with a replacement of thirty percent to address the shortening of the reference period (Erler, 2011). Additionally, two months are called “fathers months” including that the reference period increases to fourteen months when both parents interrupt working. Furthermore, a three-year job protection is included in this reform. Parents can work up to 30 hours per week. However, the earnings are set off to the allowances. Altogether, the new system is a “much more generous transfer with, in principle, universal coverage” (Kluve & Tamm, 2013) since it directs to all income groups. Furthermore, it is firstly explicitly addressed to fathers.
In August 2013, two very different policies took effect. One give parents a legal claim to subsidized childcare for all children aged one year and above, another was called ‘Betreuungsgeld’, which, as has been noted above, has since been decommissioned.
The parents’ money plus (Elterngeld plus) was introduced as an extended version of the parents’ money (BMFSFJ, 2015) in 2015. The reform aims at combining parental allowances and part-time work of parents. The entitlement period of parents can be extended if parents decide to work part-time after childbirth. Thereby, one month of the reference period of the parents’ money turns into two with parents’ money plus. In both reforms, the policies replace the loss in income by 65 to 100 percent, calculated on the basis of the previous income. Thereby, the sum of the parents’ money plus “lies at maximum half of the monthly parents’ money sum to which parents without part-time income would be entitled” (BMFSFJ, 2015, p. 4). This regulation allows parents to be more flexible after the 14th month after childbirth. ← 74 | 75 →
Ziefel and Gangle (2014) assess in how far mothers respond to changes in leave entitlements. The analysis shows that mothers respond to various changes in Germany’s parental leave program, including both entitlement extensions and incentives to return to work. Transition rates for a return to employment are low during times covered by parental leave entitlements, but they peak when entitlements are exhausted. There are five consecutive entitlement extensions between 1986 and 1992 that have been accompanied by respective increases in the duration of employment interruptions following childbirth. This upward trend has partly been reversed by stronger monetary and procedural incentives for shorter leaves implemented in 2001, but more consistently by the introduction of parent’s money in 2007. Respective behavioral changes are observable among both East and West German mothers despite long-standing differences in gender culture and availability of public childcare, as was addressed above. Drasch (2013, p. 992) summarizes that “women tend to make use of the entire leave period, regardless of its legal duration.”
Taking a closer look at the parents’ money here, it was introduced to promote a fast return-to-job turn-around after childbirth. Thereby, it was designed to give high incentives to stay at home for one year but encourage women to return to work after. The reform replaced a program which paid means-tested benefits for up to 24 months and instead provides earnings-related benefits for twelve months, without a means test, and for all mothers.10 As a consequence, the labor supply of mothers decreases in the first year after childbirth. In the second year, labor supply of mothers in East Germany and low-income mothers in both parts of Germany then increases again (Geyer, Haan, Spieß, & Wrohlich, 2013).
Taxation laws are relevant heredue to the spousal tax splitting in Germany. The spousal tax splitting refers to a procedure permitting spouses to file taxes jointly. This tax bracket may be categorized as a wedlock policy, not as a family policy. When taxing the income of both spouses, the income to be taxed is added and then divided by two. This result is then applied to the basic table of income taxes. The tax is then doubled. The spouses are thereby treated as if both parts would receive exactly half of the common income implying that they are taxed like individual units. The goal of spousal tax splitting refers to the taxation of a married couple according to their common economic success. Thereby, the economic stability of a family can be maintained more easily. The underlying presumption is that a married couple is regarded as one economic unit, guaranteeing that the overall tax burden is independent of the distribution of employment between both partners. ← 75 | 76 → The treatment as one economic unit leads to a discharge (splitting effect) due to the progressive nature of the income tax compared to individual taxing. The higher the disparity between incomes, the more beneficial the splitting. The highest splitting effect appears if there is one spouse who is the only earner in a family; spouses with the same income have a similar tax and therefore no splitting effect. Should both spouses belong to the top tier of taxable income (Spitzensteuersatz), no splitting benefits can be claimed. According to the BMFSFJ, around 11.2 million couples are benefiting from the spousal tax splitting. Around 88 percent of these 11.2 million couples do have children while around ten percent do not have children. Seeing its widespread use, the following will hypothesize the abolishment of the spousal tax splitting and its effects on the employment rate of mothers. The underlying assumption of the micro-simulation is that both spouses are taxed according to their individual income and not according to their common income. Hypothetically then, the volume of employment of married mothers would increase by 161,000 full-time positions (BMFSFJ, 2015).
Differentiating the results according to distinct family types, it can be observed that the spousal tax splitting most strongly affects the employment rate of mothers with one child. Here, the employment rate would increase by three percent if the spousal tax splitting was not an option. The decrease in employment due to the spousal tax splitting affording is the stronger, the older the youngest child is. Mothers of children above 13 years of age generally see a decrease in employment three times that of mothers with a child below the age of two. The authors see a decline in potential to reenter the workforce for mothers with older children over the time. In addition, the discrepancy of the mother’s income compared to the income of the partner keeps increasing over time.
IGES (2013) evaluated the effect of the spousal tax splitting until the mothers’ return-to-job. On average, mothers would return to their job one month earlier if the spousal tax splitting would not exist. Mothers who worked full-time before giving birth would return two months earlier. The effects of the spousal tax splitting should not just be evaluated for mothers with children who are dependents, but for their life cycle. Generally, families profit over many years from this tax system. On average, a household starting their family planning benefits for about 23 years from the spousal tax splitting. Nevertheless, the advantages are generally small before the age of 30 for women because of higher marriage ages and a lower taxable income (BMFSFJ, 2015).
The provision of public childcare facilities influences the decision of mothers to work in so far as the mothers do not need to take care of the child freeing them to work without worrying about the wellbeing of their child. However, restricted opening times or access to childcare spots complicate the mothers’ job search.
The state has begun to promote the extension of the infrastructure of public childcare facilities in recent years. In particular, the child-day-care expansion act ← 76 | 77 → (Tagesbetreuungsausbaugesetz) in 2005 is intended to improve investments in public child day care. In former West Germany, public childcare was traditionally restricted to half-day care for pre-school children aged three years or older, whereas in the former GDR, the childcare infrastructure was very well developed. Child-day-care expansions are meant to improve the public day care for children under the age of three, guaranteeing one third of children in Germany a place by 2013.
The analysis of mothers’ labor supply in dependence on the availability of public childcare choices is especially important as subsidized childcare is rationed and private childcare is only available at a considerably higher cost. Wrohlich (2011) conducted a policy simulation taking into account the restrictions experienced at public childcare centers. She analyzed the households’ budget constraints with the underlying assumption that families who are restricted in their access to center-based childcare have the option of non-parental childcare in the form of privately organized care, albeit at a higher cost. The results show that mothers from former East Germany with children below the age of three with smaller day-care groups in close proximity were more likely to be employed and to extend their working time. The negative association of high child-to-teacher ratios was marginally significant for mothers living in West Germany with children in the same age. For mothers with children above the age of three years, the child-teacher-ration was unrelated to employment hours for mothers from both East and West Germany.
Next to the provision of and restrictions to public childcare facilities, the costs affect maternal labor supply. Wrohlich (2004) found that childcare costs have a significant effect on the labor supply of mothers. The labor supply elasticity is with respect to a one percent increase in the hourly price of childcare are small though significant. Increasing private childcare costs by 25 percent would result in a decline of the LFP of mothers by one percent. Finally, if childcare were free for all households, mothers’ LFP would rise by three percentage points in former west and 1.5 percentage points in former East Germany. The reason for the difference between the effects in former East and West Germany is that both, labor supply elasticities of women and the childcare costs (as percent of net household income), are higher in former West Germany.
Schober and Spieß (2014) reviewed if subsidies on day care, financed by increased taxes, can raise welfare by encouraging women with small children to work, in other words they questioned the effects of distortionary taxes on labor. According to their analysis, the reform that maximizes a distribution-neutral social welfare function involves subsidizing day care at a rate of fifty percent and leads to a near doubling of labor supply for mothers with small children. The overall welfare gain from this reform corresponds to a 0.4 percent increase in consumption.
Public healthcare in the welfare state system may also be influencing maternal employment (Gesetzliche Krankenversicherung). In Germany, one spouse may be freed of contributions in the case that they are not paying social insurance contributions ← 77 | 78 → themselves, or are self-employed. The BMFSFJ (2014) published the results of a micro-simulation assessing the effects of this policy on the employment of women in general and mothers in particular. They presume the counterfactual situation that contributory-free insured spouses have to pay a monthly lump sum of Euro 132 for health and long-term care insurances. This is the contribution which is currently paid by unemployed insured people for health insurance and long-term care insurance. The micro-simulation assumes a non-profit or revenue-neutral system. This means that the additional income by the previously contributory-free people leads to a decrease in the insurance contributions of all, considering changes in the employment behavior of employees, who are normally not affected by the policy, like singles.
This analysis can have two different outcomes. On the one hand, it might be that the newly introduced contribution is like a new tax for the target group, reducing or discontinuing their employment. Thereby, the target group would now need to pay a higher proportion of their gross income to social contributions, leaving them with a lower net income. This is also known as a negative substitution effect. On the other hand, there are incentives with a work-time-expansion, since one needs a higher gross income to ensure a certain net income. This is known as an income effect.
The situation can moreover be regarded as a second-earner effect for couples since the contribution-free insurance can be worthwhile for spouses, if just one partner is employed and obliged to pay the social insurance contributions. Thereby, the partner receives the same insurance benefits without paying the contributions. Marginal employment does not require social insurance contributions either, making work in this group enticing also. The results show, that the contribution-free insurance situation trends to lead to lower employment rates for women. The volume of employment is reduced by 100,000 full-time equivalents of women. Two thirds of this reduction in the female employment rate go to married mothers. Married mothers decrease their working volume by 67,000 full-time equivalents due to the described second-earner effect. The effects are stronger for mothers with one child compared to mothers with two children. The effects show the strongest decrease in employment for mothers who have children two years of age or younger. The results vary between income quartiles of the mother. The mothers who have an income in the third income quartile are employed significantly less often. Mothers within in the second and fourth income quartile reduce their work time less drastically, due to the contribution-free insurance system. There does not seem to be a difference for mothers who have an income within the lowest quartile (BMFSFJ, 2014). A study by IGES (2013) revealed effects of the contribution-free insurance system on the employment rates of mothers and their return, now later, to their workplace. They noted that mothers indicated an earlier return to work, on average three months earlier, if this system were not in place.
Mothers suffer from substantially lower old-age insurances due to labor market interruptions after childbirth. Therefore, in 1986, the government instituted a compensation for years spend raising children full time. The law was reformed in 2014 under the name mothers pension (Mütterrente). The reform included that two instead ← 78 | 79 → of one year of child-care years for all children born before 1992 will be considered when estimating the old age insurance for mothers. Haan and Thiemann (2015) analyze whether the child-care years in the statutory pension schemes influence the mothers’ decision of when to return to their job. The authors concluded that mothers do not react to the pension compensation. The result implies that the increase in retirement funds for mothers has no effect on their employment status. The authors suggest that mothers do not consider the level of their retirement at time of starting their families. Looking at the life-cycle effects of the policy, the contribution-free policy might have long-term effects. This benefit reduces the labor supply of married women – and especially mothers – after marriage. As a consequence, the reduced labor supply due to the insurance system may have long term effects, which cannot clearly be isolated.
Moving away from the external circumstances or determinants related to the cognitive abilities of mothers (for instance, it can be assumed that the IQ influences substantially the education) addressed above, this section will address cognitive skills and connected issues directly.
Generally, the health status of an individual is a determining factor for the degree of LFP. Regarding maternal employment, it is observed that females, who assess their health status as less than average before giving birth, are less likely to return to work after giving birth (Michaud & Tatsiramos, 2011). Personal attitudes of mothers towards financial security (Gauthier, Emery, & Bartova, 2016) play an important role for some women, as they want for the financial security and independence afforded by their own salary as well as the partner’s income.
Berger (2013) analyzes the effects of non-cognitive skills at the time of reentering the work force. There are two potential impacts, one, the overall labor market attachment might be affected by non-cognitive skills, and two, these skills form the perception of mothers’ attitudes on caring for the child by herself or using external childcare sources. The author targets the locus of control, the “degree to which an individual perceives that success or failure in life follows from his own behavior or attributes versus the degree to which he feels that it is controlled by forces outside of himself and may occur independently of his own actions” (Berger, 2013, p. 24).” Berger concludes that females with a strong belief in external control as well as agreeable women tend to delay their work return substantially longer. Mothers with an internal locus of control expect returns of labor market participations in the future and are hence likely to invest in it. Furthermore, mothers with an internal locus of control are more likely to look for a solution for the reconciliation of work and family.
Gangl and Ziefle (2015) highlight that German parental leave policies influence the social norms of mothers, which in turn influence their work commitment. They conclude that the shortening of parental leave, for instance in form of the parents’ ← 79 | 80 → money, increased the work commitment of mothers with young children, especially with mothers working full-time.
The subsequent section focuses on determinants of maternal labor supply which are not covered by the previous sections. These determinants are not regarded as decisive for the decision of mothers to increase the labor market participation, but can be influential in certain situations. The following will take a closer look at the social support network, differentiating between the family-dependent network and the non-family dependent network, and at the local labor market situation.
The following paragraphs examine in how far the informal social networks play a role for the decision of mothers to work. Thereby, the role of the informal network is twofold. On the one hand, the informal network can be regarded as an additional source for childcare. For instance, friends, neighbors, or other acquaintances can help in emergency situations, for instance, in case of unexpected overtime. Parents who prefer a child-minder over public childcare facilities often choose one from within their familiar network. And the informal network often provides information and shares experiences, providing often helpful tips and advice, especially when given by familiar people.
One major childcare resource concerns grandparents. Assave, Arpino, and Goisis (2012) examine, in a multi-nation study, the relation between grand-parenting and maternal labor supply. Former East Germany was excluded from the analysis due to a small sample size. Newlywed mothers were included to evaluate the effect for a homogenous group of people. Controlling for the availability of public childcare, they examined a positive association between the two variables in Germany, France, Georgia, Hungary, and the Netherlands. There was no association at all in Russia and Bulgaria. In Germany, interestingly, the association between the availability of part-time jobs and grand-parenting is significantly higher than in the other countries. Looking at differences within Germany, it appears that the relationship between couples and their parents deepens when they have their first child. They contact each other more often once the woman is pregnant both in former East and West Germany. Former West German mothers depend more frequently on their parents to aid with the child (Klärner & Keim, 2011). Grandparents are found to also often support the couple financially. Former West German grandparents are frequently asked for advice about child rearing.
Several mothers from former West Germany highlighted that they had the impression that their parents wanted to push traditional gender roles. The situation differs in former East Germany. Here, the parents mention that they do not often rely on their children’s grandparents, not financially or for other kinds of support. Personal beliefs and values, according to the authors, are one of the main reasons for these differences. The younger generation in former East Germany adopted their parents’ opinion that “the two-income model with children and flexibly managing family and professional life is still natural, coping with adverse circumstances is passed on from generation to generation” (Klärner & Keim, 2011, p. 530).
Including the non-family related network as well, Wagner (2012) examines the effects of comprehensive social networks of mothers in Germany. She defines the ← 80 | 81 → social network as family, friends, and spouses. She finds that full-time working mothers benefit to a much higher degree from a strong social network than part-time working mothers. In both cases, such a network is more important if the supply of public childcare is low. Wagner identified that West-German mothers benefit more often from social support compared to migrant mothers from Turkey, Italy, Spain, Greece, and former Yugoslavia. The informal network seems to be irrelevant for the employment rates for East German mothers. Though emphasizing that the following countries do not have an extensive system of social protection for families and are not characterized by the German male breadwinner model, Wagner (2012, p.17) observes that mothers in Germany with roots in Italy, Spain, Turkey, Greece, or the former Yugoslavia see the “family as a provider of care and ultimate responsibility-taker for its members’ welfare, strengthening women’s roles as caregivers.” Here, women see it as their cultural obligation to stay at home.
The local labor market influences maternal employment in so far as a certain labor market structure may increase the incentives for mothers to apply for employment or discourage them to do so. Van Ham and Büchel (2006) address the issue by investigating influential factors on the macro level for female LFP, highlighting major differences between male and female employment behavior. They distinguish between two phases during the pre-employment time for women: “the willingness to have a paid job and, for those willing to work, actually having a job” (van Ham & Büchel, 2006, p. 354). By means of this approach, it is possible to identify the extent to which poor labor market structures discourage women from being in the labor force. In the course of the analysis, three distinct groups could be identified: unemployed women not seeking employment, unemployed women seeking work, and employed women. Poor labor market conditions, especially those marked by a low regional female unemployment rate, seem to be dominated by women less likely to engage in a job search. Contrary to the expectations of the authors, no discouraging effects in connection to a long traveling time or poor access to public childcare facilities could be identified.
The higher the regional female unemployment rate, the longer the travelling time to the nearest employment opportunities, and – for mothers – the poorer the regional provision of childcare, the lower the probability of finding a suitable job. In conclusion, the local labor market plays a role in both steps of employment, however the regional barriers of being employed influence mainly the second part of finding a suitable employment: those willing to engage in paid employment actually finding a job (van Ham & Büchel, 2006). Nieuwnehuis, Need, and van der Kolk (2012) examine, in a multi-nation study, that both, mothers and women without children, were more likely to be employed in societies with a large service sector and a low unemployment rate, showing that not solely regional/local, but national labor market structures are of interest here. ← 81 | 82 →
Addressed above, there are different actors shaping and influencing maternal labor supply. It has been demonstrated that the predominant actor is the state, while companies often act as complementary, orienting themselves long the framework of the welfare state. Taking the findings of this chapter, other determinants were found to have an influence as well, making it worthwhile to observe the interaction between some of these distinct influences. Generally, two different methods are used to analyze the interaction. Firstly, multi-nation comparisons allow to determine the importance of distinct factors in various countries. Secondly, longitudinal studies permit the observation of shifts occurring over time, increasing or decreasing the importance of certain factors to be considered. The interdependencies of various determinants can also be observed more clearly, such as the introduction of the childcare subsidy and the simultaneously introduced right for childcare facilities of children older than one year are both policies of the welfare state (see section 2.3.1. “Reasoning of public childcare and childcare options” and 3.4.1. “Monetary leave policies”). The policies had different goals, but affected both parents with younger children. The childcare subsidy increased the freedom of choice to care for one’s children at home or outsource said childcare. The legal right for public childcare promoted explicitly maternal labor supply. The differences in the goals lead to differences in the acceptance and usage of the policies for different target groups. The policies did not support each other, but acted in competition with each other.
Focusing on inter-European comparisons, Hipp and Leuze (2015) analyzed which factors influence an egalitarian distribution of paid work between parents. The distribution of paid work between partners is smaller if the income is taxed individually, the childcare facilities are fully developed and the gender wage gap is rather small. These factors support each other and lead to an egalitarian understanding of gender. These results are supported by the fact that generous public childcare and cultural support for gender equality are associated with smaller gaps in the preferred working hours between mothers and childless women. In contrast, well-paid parental leave policies lead to a larger gap in preferred working hours between both female groups. It has also been demonstrated that a low prevalence of non-standard work and high levels of work-time flexibility reduce the differences in preferred employment hours between mothers and non-mothers. Individual characteristics such as education, gender ideology, and the partners’ socioeconomic status greatly impact women's preferred employment hours (Pollmann-Schult, 2015). Work-family conflicts have higher values in a European national comparison, if there is a certain degree of uncertainty. This relationship can be observed on the national level (for instance liberal vs social-democratic ones) and on the company level (Ollo-López & Goñi-Legaz, 2015).
The following authors compare the adoption of childcare support and flexible working arrangements by a company in dependence on the country in 19 European countries (Den Dulk, Groeneveld, Ollier-Malaterre, & Valcour, 2013), defining ← 82 | 83 → state support for the reconciliation of family and work, such as statutory parental leave, public childcare, and offered flexibility of working time. Their results show that state support for the reconciliation of family and work is positively associated with the provision of childcare support as well as the possibility of using flexible working arrangements. Cultural centrality of work is associated negatively with both of them. With regard to the kind of companies, the public sector and larger companies are more sensitive to state support and cultural centrality than private sector, small, and medium sized companies. A large share of female employees is less sensitive to state support. These findings illustrate that organizational policies are influenced by the national contexts in which they are embedded.
Taking a slightly different perspective, Den Dulk, Peters, and Poutsma (2012) examine whether variations in the adoption of family-friendly HRM are dependent on the welfare state or the company in question. Their results reveal that organizational conditions and characteristics at the company level outrank the welfare state for consideration. The results, however, also show that when the “development of family-friendly workplace policies is mainly left to the market, as in the liberal context, employers do not fully make up for the absence of public provisions” (Den Dulk et al., 2012, p. 2786). The authors conclude that the welfare state creates a normative climate that gives rise to new social expectations and ‘a sense of entitlement’ regarding work-family support.
Abendroth et al. (2015) observe that the relationship between the welfare state, family, and employing businesses is nearly always complementary in this context, except for public childcare and supportive HRM. Public childcare is only beneficial for increasing working hours of mothers when supportive HRM are available and vice versa. Especially constraining opening times of public childcare facilities require some flexibility.
There is a wide range of factors influencing maternal labor supply. While the focus was on ESCC, it is nevertheless clear in presenting a substantial amount of literature focused on state and national intervention that scholarly interest focuses on the welfare state in this context. Generally, the influence of the employer and the working environment are researched less frequently.
Individual factors mostly influence maternal labor supply in one distinct direction. For instance, a higher income before giving birth is mostly associated with a shorter leave and earlier return-to-the-job. The literature review revealed that mothers do react to changing environments and conditions. For instance, it has been demonstrated that mothers react if parental leave policies are altered. If parental leave times have been extended mothers tend to stay at home for longer, while a shortened funded parental leave also often begets an earlier return-to-job. Maternal labor supply, thusly, can be regarded to a certain degree as dynamic (see also chapter 2). The general tendencies are summarized in the following table. ← 83 | 84 →
Table 3-1: Overview on determinants of maternal labor supply
The table reveals general trends in reaction to maternal labor supply determinants. This chapter revealed that the length of the work interruption after childbirth is primarily determined by the parental leave benefits. Individual determinants as well as the working environment rather influence the working volume.
Concerning the data and methodology of the above-utilized studies, focusing on the ESCC, several elements need mention. Approximately half of the studies used personnel data provided by companies, whereas the other half depended on publicly provided datasets (e.g. Swiss Human-Relations-Barometer or General Social Survey of the US). The effect of ESCC on work behavior in terms of working volume has never been analyzed for Germany with a public data set, only with personnel data (Commerzbank, 2009; Then et al., 2014). The datasets provided by businesses do not differentiate between men and women, or between mothers and non-mothers. Furthermore, the small test group does not allow for statistical tests, which implies that no control variables can be included. Causality tests cannot be conducted with this sample size, just descriptive statistics. This constraint limits the empirical power of the studies substantially. For instance, Münscher and Stahlschmidt’s (2014) sample consists of only 114 users of a German on-site childcare center, which is too small for significance tests. The center opened in 2008 and the data includes the years 2006 to 2012. In Germany, the parents’ money reform was introduced in 2007. The authors did not include this reform in their analysis, but concluded that the on-site childcare center had a positive impact on the (reduced) stay-at-home time of the employees. It might, however, have had an effect on the parents’ decision, even if the authors did not include it in their estimation. The operationalization of ESCC is mainly dependent on the data set. While studies with personnel data focus on on-site childcare, studies with public datasets mostly analyze the effect of an aggregation of different kinds of ESCC. ← 85 | 86 →
The studies do not reveal a common trend, but instead identify patterns. Those using personnel data and descriptive statistics, and analyzing on-site childcare, find a positive effect on absenteeism, employee turnover, and the intention to leave a work place (Anderson & Geldenhuys (2011), Gullekson, Griffith, Vancouver, Kovner & Cohen (2014)). Considering the limitations of personnel data, these results should be analyzed carefully. Until now, the study by Gullekson, Griffith, Vancouver, Kovner and Cohen (2014) is the only study which differentiates between different kinds of ESCC. According to them, there is no difference for parents whether the employer provides vouchers or on-site childcare facilities. The parents value both kinds to the same degree.
The implications from the literature review will now be applied to the specific study at hand. This study, in line with previous research, aggregates the different kinds of ESCC. Based on the description of different kinds of ESCC in section 126.96.36.199. “Outlook on employer-supported childcare”, it seems to be necessary to differentiate between regular and emergency care. Since the latter one just focuses on punctual care, however, it is no support in the everyday care. This study also explicitly aims at analyzing the impact of ESCC on work output, implying that the effect shall be quantified in terms of working hours or amount of working mothers. Finally, most studies follow a demand-oriented argumentation, much as the following will pursue. However, no previous study has distinguished between different kinds of employees effects might vary between higher and lower skilled employees. This addition may provide important input and speak to implications relevant for employers since they are certainly concerned with how to increase work output.
6 For instance, in comparison, in Sweden, money is often kept outside the relationship and regarded separately.
7 Since both studies investigate the effects of ESCC, Appendix B „Overview on further effects of ESCC” lists all effects found in the studies, which will be discussed in more detail later.
8 Own translation: “Sie arbeiten im Durchschnitt 3 Monate mehr als Eltern, deren Kinder nicht in der LuKids-Betriebskita sind.”
9 Parts of this description have been derived from the following paper: http://www.diw.de/documents/publikationen/73/diw_01.c.436290.de/diw_sp0625.pdf?
10 For more details on the parents’ money and to set the parents’ money into context to the overall development of leave policies in Germany, see section “Short historical flashback of German leave policies”.