Paid maternity leave is not a fertility policy

There is no evidence of a connection between high fertility rates and maternity leave.

The International Experience

The international experience shows us that fertility rates have declined in all advanced industrial societies in the last 40-50 years. In fact there is a strong connection between falling fertility rates and rising living standards.

Fertility rates in the European countries, Japan, the Anglo countries – Canada, New Zealand, Australia, are all less than 2. Countries with fertility rates above 5 include Gabon, Congo, Rwanda, Mali, Uganda, Angola, Somalia, Yemen and Mozambique. Obviously these countries do not have high fertility rates because of the provision of universal maternity leave. In fact virtually all the European countries which provide universal maternity leave have fertility rates equivalent to or lower than that of Australia.

Countries with high living standards have low fertility rates. Countries with low living standards generally have high fertility rates.

A study by Gauthier and Hatzius (Population Studies, 1997) across 22 industrialised countries for the period 1970 to 1990 concluded that "…maternity leave (duration and benefits) did not appear to be significantly related to fertility".

Australian Experience

If we break down Australian Census results we find that cultural background and ethnicity are significant factors determining fertility rates. For example, in 1996, women aged 15 to 30 years who describe themselves as Christian had given birth to 0.39 children on average, the same as the average number of children born to women who describe themselves as having no religion in this age group. The average number of children born to women who describe themselves as Muslim in this age group is nearly double at 0.75.

For women aged over 30 years the average number of children ever born to those describing themselves as Christian is 2.4, for those of no religion 1.9 and for those describing themselves as Muslim 3.0.

Fertility appears to vary to some degree by ethnicity. According to ABS statistics, fertility rates for Australian resident women born overseas are, in descending order, those born in Lebanon (3.54), Turkey (2.54), Egypt (2.49), Cambodia (2.35) and Fiji (2.14).

Fertility rates also appear to vary according to educational levels and according to income (which shows a strong correlation to educational levels).

There is some evidence that fertility can be increased by large cash payments, see for example the experience of Quebec, Canada, which between 1992 and 1997 made a payment equivalent to Canadian $8,000 over a five year period following the birth of a third or subsequent child. This contributed to an increase in the province's total fertility rate (TFR) from 1.4 to 1.6 during the years in which the scheme operated. These cash payments were not related to maternity leave and were available to women who were not in the workforce, and never returned to the workforce.

Conclusions

Fertility rates are determined by factors such as ethnicity, religion, education, income and living standards, and not to the provision of funded maternity leave. Again, this is not to say that maternity leave is a bad idea. It is simply to make the point that it is not an answer to declining fertility.

Fertility rates can be moved to some degree by financial incentives, but the movements are small and the incentives need to be very large. Fourteen weeks of paid maternity leave is not large enough to induce a significant behavioural change. And maternity leave only applies to those in the workforce. To move fertility rates, the payments should be available for additional births regardless of whether the mother is in the workforce.