Media Release

March 16 2009

Paid maternity leave is a stimulus measure, say experts

"The timing is right" for paid maternity leave. Australia and the United States should adopt national systems of paid maternity leave as part of their response to economic downturn, according to Australian and US labour market experts.

Professor Barbara Pocock, Director of the Centre for Work and Life at the University of South Australia, and Professor Margaret Hallock, an economist and founding Director of the Wayne Morse Center for Law and Politics at the University of Oregon in the United States, have called on the Australian and US Governments to include paid maternity leave in their economic stimulus packages.

“In the process they can catch up with the rest of the world on paid maternity leave, as well as providing an economic stimulus,” they said.

Professor Hallock said paid maternity leave is an ideal economic stimulus measure.

“We can be confident that every dollar of paid maternity leave will be spent. Families who are managing on a lower income when a baby arrives will not be squirreling away savings: they will spend their income,” said Professor Hallock.

“Paid leave would have another benefit. It will put money where it matters: into the pockets of low income households. In both the US and Australia it is low income households that miss out on paid leave, so a good national system has the benefit of helping out those who need it most – helping employers, parents and children.”

Australian labour market economist Barbara Pocock said economic downturn added to the argument for paid maternity leave, rather than detracting from it.

“The current context presents a real opportunity for Australia and the US to join the rest of the developed world and provide paid leave for working mothers,” Professor Pocock said.

“It will relieve part of the stress in the labour market, shortening overall working hours and spreading working hours more broadly.

“The Australian Government has so far spent over $52.4 billion on economic stimulus measures. Given that the Productivity Commission puts the cost of a national government-funded paid maternity leave scheme at 1 per cent of this ($530 million) in its draft report, we can deliver an historic catch up as part of the next budget and help offset the economic downturn as well as assist those most in need: low income Australian working families and employers who increasingly rely on the contribution of working mothers.

“The timing is right.”

Professor Pocock and Professor Hallock will tackle this and other issues confronting Australia’s working women at a forum at UniSA tomorrow night.

‘Justice for Women at Work: A discussion of paid parental leave and pay equity’ is being jointly presented by The Bob Hawke Prime Ministerial Centre, The Centre for Work + Life and the School of Management. Go to www.hawkecentre.unisa.edu.au to register.