Parenthood and Labor Market Outcomes: Evidence from Chile

Abstract Throughout the pandemic Chile implemented a series of public health mandates restricting mobility and high social-contact activities with a goal of reducing disease spread. In this paper, we study the impact of one of these policies-central planner variation in school reopenings on labor market outcomes. We examine how access to supervised care for children in school affected mothers’ labor supply and show that mothers increased labor force participation anywhere from 2.6 to 21.0 percentage points (ppts) as schools reopened. As mothers came back to the labor force, however, unplanned disruptions decreased their ability to stay actively engaged in work and increased their take up of leave from work, an artifact of unanticipated sick children and quarantine policies that particularly affected mothers who were secondary earners in the household. Conditional on being in the labor force, having a teenager buffered both mothers and fathers from work disruptions; parents were more likely to be actively working and less likely to be on leave. Our findings support a theory that parental labor supply is sensitivity to disruptions in the care of children but also depends on household composition and each parent’s role beyond gender. Policies that encourage consistent formalized systems of care and learning for children will not only benefit children, but also a second-earner’s ability to re-enter the labor force and advance at work. JEL: J13, J16, J22