Equal Leave, Solo Impact: When Equal, Non-transferable Paternity Leave Reduces the Motherhood Penalty in Spain

After a recent set of reform of paternity leave in Spain, Spanish fathers now enjoy on-par leave entitlements with mothers, making it the longest and most generous paternity leave entitlement in the OECD. The main goal of extending paternity leave was to close the gender gap in the labor market by reducing the penalties women typically face after motherhood: taking career breaks, returning to work on a part-time basis, and losing income. We evaluate the impact of the reform on the motherhood penalty with an original cross-sectional survey administered to cohorts of parents with children born between 2018 and 2022, and thus with ample variation in fathers’ leave duration. We compare labor market outcomes for mothers across these cohorts to test whether the gender gap in the labor market recedes as paternity leave is extended. Results indicate the significance of fathers taking solo leave in reducing the impact of the motherhood penalty. When fathers take leave without overlap with mothers, mothers tend to return to work sooner, are more likely to work full time, and are less likely to become inactive on the labor market The effects are stronger for first-time parents.