Study Claims Parental Leave Doesn’t Hurt Firms

WASHINGTON —  Small businesses in states with strong parental-leave policies have continued to grow at a robust pace, discrediting fears of some business leaders that a federal requirement for such leaves would create an undue burden on small companies, a new study released by the National Assn. of Working Women said Thursday.

Representatives of women’s rights groups urged Congress to take note of the study’s findings and pass legislation that would require all employers of more than 50 people to give workers up to 10 weeks of unpaid leave each year to care for a sick or newborn child.

Bills in Both Houses

Bills with that provision are pending in both the House and Senate.

“We have laid to rest the single most important argument the business community has raised against family leave,” said Karen Nussbaum, director of the National Assn. of Working Women.

However, Fred Krebs, a lobbyist for the U.S. Chamber of Commerce, vigorously disputed the study, charging that it makes statistical “leaps of faith” and calling the concept of federally mandated employee benefits “fundamentally flawed.”

Increased Costs Claimed

Small businesses have opposed parental-leave legislation, maintaining that their small number of employees makes them especially vulnerable to reduced productivity and increased costs when a worker goes on leave.

According to the study, small-business employment in states with leave standards grew in 1987 at a rate 21% greater than in states without such regulations, and employment in companies with fewer than 50 employees in states with leave policies is increasing at a 9% faster rate. The researchers said that the analysis used employment data collected by the Small Business Administration .

The seven states with leave requirements are California, Colorado, Connecticut, Kansas, Massachusetts, Montana and Washington.

John Willoughby, an economist who led the research project, acknowledged that he could not be certain the parental-leave regulations contributed to the job gains.