Paid family leave and paid sick leave as economic investments: Evidence for improving workforce stability and population health in the United States

The United States remains the only high-income country without a federal guarantee of paid family or medical leave, leaving coverage to a patchwork of  state programs and employer-provided benefits. This review evaluates the empirical literature on paid family leave (PFL) and paid sick leave (PSL) as investments in workforce stability and population health, synthesizing quasi-experimental evidence on leave-taking, employee retention, firm performance, maternal and infant health, and employer costs. The evidence indicates that PFL roughly doubles maternity leave-taking without reducing employment, increases fathers' leave-taking, and is associated with improved maternal psychological health and reduced infant mortality. At the firm level, studies find no increase in turnover or wage costs following PFL adoption, with some evidence of improved firm productivity and profitability through reduced turnover. Paid sick leave mandates reduce presenteeism and illness transmission with little evidence of adverse employment effects. These findings challenge the assumption that paid leave mandates necessarily impose costs on employers, instead pointing to a body of evidence consistent with paid leave functioning as an investment that yields returns through retention, productivity, and population health. The review closes by identifying gaps particularly around long-run firm-level causal evidence and the interaction between state programs and a potential federal floor and offering policy recommendations for maximizing the economic and public health returns to paid leave.