Reposted from the Milwaukee-Wisconsin Journel Sentinel
By Zohreh Emami
As an economist in the School of Business at Alverno College serving a diverse population of current and future business women in our community, I am well aware of the opposition of certain business groups to programs such as the Wisconsin Family Insurance fund based on the argument that they are too expensive.
But we also need to ask about the cost of our economy not adjusting to the realities of American families and businesses. That’s why I believe it’s crucial that policy-makers and the public know about a recent letter to Congress written by more than 200 business school faculty members from 88 institutions across the country in support of making paid family and medical leave available to all working families.
Their analysis is based on best business practices in the United States and data from comparable countries, all of whom have offered paid leave for a long time. They draw on research they’ve conducted with employers, employees and organizations, and on their experiences teaching the business leaders of tomorrow. They also have studied specific programs that already exist in the United States in three states: California, New Jersey and Rhode Island.
These studies, they note, “lay bare the claims of business opponents.”
In fact, the vast majority of California employers report a positive or neutral impact of the paid family leave program on employee productivity, profitability, and performance. A report prepared on behalf of the New Jersey Business and Industry Association found that businesses both large and small said “they had adjusted easily to the state’s family leave insurance law and experienced no effects on business profitability, performance or employee productivity.” And a just released report on the experience of Rhode Island businesses in the first year of that state’s paid family leave program found support from a majority of large and small employers in the food and manufacturing sectors.
The research points to the win-win vs. zero-sum outcomes of paid family and medical leave. In their letter, these professors identify benefits for businesses of paid leave as increased retention, loyalty and effectiveness. Turnover can be a costly proposition for employers. Replacing staff in high-paying jobs requiring specialized skills can cost 213% of their salaries. Turnover is costly even in low-wage jobs.
The business professors also point to the positive benefits for workers and families, including better outcomes for infants and mothers, and increased involvement of fathers. It is indeed important for us to acknowledge that paid family and medical leave is not only good for families but also good for business.
Many of our Alverno students will go on to become small business owners. For them, this program is particularly beneficial. Small business owners are more likely to know their employees’ families. They often wish they could afford to cover wages while someone has a new baby or a parent who’s had a stroke, but lack resources to cover an extended leave.
This employee-funded family leave insurance program allows them to support employees while they’re out and then benefit from their return to work. With a family leave insurance program, small businesses can be competitive with larger firms and not have to lose out on attracting and retaining staff.
In 1988, Wisconsin was a pacesetter in the nation in passing unpaid family and medical leave. With the current work and care needs of our families, it’s imperative for us to ask — what’s the cost of doing nothing on paid leave? The answer is that we all as workers, families and employers pay a price.
Our state should proudly help lead the way in making this leave affordable. Wisconsin families need it. So do our businesses.