Closing The Gap

17 state treasurers urge Congress to include federal paid family leave in Biden's American Families Plan

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State treasurers from 17 states sent an open letter to Congress on Wednesday urging lawmakers to pass federal paid family leave and medical leave as proposed in President Joe Biden's soon-to-be released American Families Plan.

"We are concerned that the lack of a federal paid family and medical leave program leaves many hundreds of thousands of working people across the country without adequate access to care for themselves or their family members, leaving them to face an impossible choice between working and potentially spreading Covid-19 or the next pandemic," the state treasurers wrote in the letter that was organized by the national campaign Paid Leave for the United States and the public charity For the Long-Term.

Just nine states and the District of Columbia have paid leave policies today, the letter states, "which leaves the overwhelming majority of states' finances and investments vulnerable to potential investment losses and operational risks."

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Currently, the United States is the only industrialized country without a federal paid family leave policy, resulting in 1 in 4 American moms returning to work just 10 days after giving birth, according to Paid Leave for the United States. With the pandemic shutting down many schools and businesses, data shows that a lack of paid family leave has only exacerbated the challenges many working women already faced.

Not only have women been disproportionately impacted by job loss during the pandemic, but more than 1.8 million women have also left the labor force since February 2020, according to the National Women's Law Center, meaning they are no longer looking or applying for work.

This mass exit has been attributed to the ongoing caregiving crisis women face, with mothers three times as likely as fathers to be responsible for housework and child care during the Covid-19 pandemic, according to a September report released by Lean In and McKinsey & Company. Mothers are also twice as likely as fathers to worry that their work performance is being judged negatively because of their caregiving duties during the pandemic. As a result, experts say a lack of paid family and medical leave, along with the closure of many schools and child-care centers, has led millions of women to leave the workplace.

"The pandemic highlighted in the most extreme ways the vulnerability of women, and particularly Black and Brown people, who are working in front-line jobs," Massachusetts Treasurer Deborah Goldberg tells CNBC Make It. "Those are the people that we've been trying to break down barriers and create economic opportunity and economic stability for, and yet they were the most impacted. So in many ways we've gone backwards in terms of having successful economies in each state."

Profile of new State Treasurer Deb Goldberg, who next week will chair her first PRIM state pension fund board meeting as its chair. Goldberg in her State House office.
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Goldberg, who signed the letter along with state treasurers from California, Delaware, Maryland and Maine, says the benefits of paid leave are "multifold." Internally for companies, she says having paid leave will lead to less turnover among employees, and more generally it will lead to more people being employed and thus a better economy.

"We all know that whether it's an organization or whether it's a state economy, that having people employed makes our environments more dynamic, more creative and more financially successful and all these things weave together," she says. "As treasurers, we focus on those fundamentals at all times and we have an understanding of the snowball effect if we lose that, and so paid family leave is just a basic, obvious way to create stability."

During the pandemic, temporary paid leave provisions were put in place with the Families First Coronavirus Response Act (FFCRA) passed in April 2020, which required businesses with fewer than 500 employees to offer paid leave to staff. However, that benefit expired at the end of 2020; state treasurers noted in their letter that the American Rescue Package passed in March 2021 "does not extend the requirement for employers to provide emergency paid family leave."

While no exact date has been given for when Biden will release his American Families Plan, state treasurers who signed the letter are supported by more than 250 business leaders who expressed in a March letter to Congress that "access to paid leave also leads to better retention, personal health, and improved morale, which contributes to greater stability and viability for our businesses, ultimately helping our bottom line."

"In short," the business leaders stated, "paid leave is good for business."

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