Effects of California’s Paid Family Leave Law on Caregiving by Older Adults

Abstract

In 2004, California became the first state to require that employers provide paid family leave (PFL) to their employees. This paper examines the effect of California’s PFL law on time spent caregiving to parents and to grandchildren by older adults aged 50–79. To identify the effect of the law, the paper uses the 1998–2016 waves of the Health and Retirement Study and a difference-in-differences approach comparing outcomes in California to other states before and after the implementation of the law. Results suggest that the law induced a switch in caregiving behavior with older adults spending less time caring for grandchildren and more time helping parents. Focusing on women, results further suggest that PFL affected older adults both through their own leave-taking and through reallocations of their caregiving time in response to leave-taking by new parents. The findings motivate thinking more broadly when calculating the costs and benefits of PFL policies; to the extent that California’s PFL law enabled older adults to provide more care for their parents they otherwise would not have received, such an outcome represents an indirect benefit of the policy.