Quebec is a distinct society, parental leave edition

My colleague Jennifer Robson has recently published a study on parental leave for the Institute for Research on Public Policy. It provides a detailed comparison of parental leave in Quebec and the rest of Canada (ROC), and provides a number of recommendations for changing the way that parental leaves are delivered through Canada' Employment Insurance system. 

As Professor Robson describes in her study, Quebec's parental leave policies are quite different from those in the rest of the country. It is easier for parents who are self employed, and those who work relatively few hours, to claim leave. The parental benefits themselves are more generous in Quebec, especially for mothers with above average incomes - the basic Quebec benefits maxed out at $962 per week in 2016, while the maximum benefit in the rest of Canada was $537. Quebec also sets aside a portion of parental leave for fathers.

The net result of these policies is that more new parents in Quebec take leave, and parents in Quebec have higher incomes, as compared to the rest of Canada. I've reproduced one of the figures from Professor Robson's study below, to give a flavour of her results (link to original: http://irpp.org/research-studies/study-no63/)

 

My aim here is to contextualize Professor Robson's study. Quebec is a distinct society in many ways: in its labour relations, industrial mix, culture, history, and so on. If we observe differences in the behaviour and characteristics of new parents in Quebec as compared to the rest of Canada, it is important to try to figure out which of these benefits can be attributed to differences in parental leave policies, and which of these benefits can be attributed to differences in the new parent population in Quebec as compared to the Rest of Canada.  So I took the data set that Professor Robson uses - the 2014 Employment Insurance Coverage Survey - and played around with it to explore the way that new parents in Quebec are different from those in the rest of Canada.

Quebec mothers are much more likely to have unionized jobs. Here is a frequency table.

These frequencies were calculated with analytical weights, so as to get an accurate estimate of the number of people in each category - this is the method that Professor Robson used in her study. In Stata it is not possibly to test the statistical significance of the differences across categories when using analytical weights (for the reason why, see here). However, dropping the analytical weights and doing a chi-squared test finds that the differences in union rates in Quebec versus the Rest of Canada are statistically significant. 

The union/non-union distinction matters because women working unionized job are more likely to take parental leave than women in non-union jobs. Looking outside Quebec, and focusing just on new mothers who were working full-time before giving birth, 96 percent of those in unionized jobs took maternity leave, compared to  89 percent in non-union jobs (again, these numbers are calculated from the 2014 EICS). Looking at the unweighted numbers and doing a chi2 test suggests these differences are not statistically significant. But if all we're trying to do is understand why maternity/parental leave take-up rates are so much higher in Quebec, as shown in the figure from Professor Robson's paper above, it's important to remember that Quebec's higher unionization rates may be part of the story.

Why might unionized women be more likely to take parental leave? It could be the greater assurance of job protection and non-discrimination that a unionized workplace can provide. It could also be to do with the greater prevalence of employer top-ups in unionized workplaces. According to the 2014 EICS, 53 percent of unionized workers got some kind of employer top-up to their maternity-parental leave coverage, as compared to 22 percent of non-union workers.

Another big difference between Quebec and the rest of Canada is childcare. Here are the unweighted numbers with a chi2 test:

 

 Here are the numbers, weighted to be representative of the Canadian population:

The majority of children in Quebec are placed in a garderie - a daycare or nursery. Professor Robson's study says that just 4.5 percent of regulated spaces in Quebec are earmarked for infants under the age of 18 months. I'm not sure if I believe that 4.5 percent number - this suggests the proportion of spaces available to younger children is higher, as infants may be able to access spaces not earmarked specifically for them. The point I want to make, however, that if you're planning to use centre care - which most Quebec mothers are - it makes sense to take a longer leave, wait until you can find a good space for your child, and then return to work. In the rest of Canada, the return to work decision is quite different - and if reasonably-priced child care is not available, it may not be worth returning to work at all.

Third, new mothers in Quebec are less likely to be single parents - 10 percent of mothers of infants within Quebec had no partner living with them in 2014, compared to 12 percent in the Rest of Canada. The difference is small, but statistically significant, and appears again in the 2015 data. This is important to bear in mind when interpreting, for example, the figure from Professor Robson's study above. The statistics on the number of families in which "both parents received benefits" aggregate single-parent and two-parent families. So, for example, Professor Robson finds that both parents received benefits in 59.4 percent of Quebec families. However, if we focus only on two-parent families, that number rises to 65.8 percent. This does not make much difference to the interpretation of the results - I just found if interesting. 

Finally, there is some suggestion that new parents in Quebec are more middle-class, whereas those in the Rest of Canada tend to be drawn more from the top or bottom of the income distribution - but a chi2 test fails to find a statistically significant difference.

 

However these income figures are, to some extent, just capturing the difference in the wage distribution in Quebec as compared to the rest of Canada.

Professor Robson's study makes four recommendations: 

• A more responsive and inclusive eligibility test so that more parents who work and already pay EI premiums are able to collect benefits
• Targeted help for low and modest-income families through the Family Supplement
• Changes aimed at better coordinating EI benefits with income-tested child benefits
• Improved incentives for employers who top up leave benefits for their employees, to increase the coverage of lower-wage workers

I strongly support Professor Robson's first recommendation - that people who have paid into EI should be able to collect benefits. Yet f I was comparing Quebec and the Rest of Canada, I would come to a different overall set of conclusions. 

The Quebec model shows the power of universal benefits - this is a point made repeatedly by, for example, Pierre Fortin. In Quebec, because of generous universal benefits, families can afford to have children. Between 2000 and 2013, Quebec went from having a fertility rate below the Canadian average to one above the Canadian average (CANSIM table 102-4505). Quebec's child care policy is part of the reason why: see here). 

If the goal of maternity/parental leave is to enable parents to take time off work when they have young children, the first priority should be to make the program more universal. That partly means expanding coverage under EI to those who work fewer hours, but also - and this is a big part of the story - extending the program to the self-employed, and possibly taking maternity/parental leave out of EI altogether.

I am dubious about using maternity/parental benefits as an anti-poverty strategy. Some amount of targeting makes sense. But too much targeting is problematic in a country where the cost of living and wages differ so much across regions. Support for children is already largely targeted at lower- or middle-income families.  Yet a Toronto or Vancouver family can have an income much higher than a family in Miramachi - and thus receive substantially lower child benefits - and yet still struggle to pay the mortgage. Increasing the degree of targeting could create regional inequities.

I am also not convinced that families with children are now the number one anti-poverty priority. In the 1980s and 1990s, Canada's level of funding for families with children was one of the lowest among rich countries. That is no longer the case. Canada has made real progress in in supporting families with children, especially with the recent expansion of child benefits under the current federal government. From a policy point of view, additional benefits for families with children need to set against other goals. In my view, expansion of the WITB, and supporting low-wage singles, or those with marginal attachment to the labour market is a higher priority.

 

 

Comments

[Stephen Gordon]

This is really good stuff, Frances.

[Frances Woolley]

Thanks, Steve. Jennifer's piece is worth reading too - there's a lot more to it than I've captured here.

[Erik Lund]

Thanks, Frances!

Two thoughts here, as spokesman for, respectively, the cranky old man constituency, and the "people who worked an apocalyptic shift at our 25th and Oak store on Saturday." (The latter group is more exclusive.)

i) This particular cranky old man is worried about birth rates. If Quebec's policy is working, we need to double down on it. From the logic of the numbers as I follow them, that would not be social welfare-maximising, since it is not a particularly good way of addressing youth or those with marginal attachments to the workforce. Those groups are not very likely to be involved in household formation, up to, and including having babies. Here, I guess I'm just reinforcing the point you've already made. This is a separate, and valuable, policy goal.

ii) My apocalyptic work experience was driven by four(!) new cashiers not showing up for work on Saturday --about a third of scheduled hours. It wasn't even sunny! New cashiers tend to be young and marginally attached, etc. The thing is, part of that marginal attachment comes the fact that they're blowing off shifts. So, sure, transfer payments to these groups may address their problems. In my experience, however, we're shovelling out transfer payments, in the form of student loans. While this is terrible policy, and obviously doesn't help the people who can't manage to enroll in post-secondary education, we can see what the results of more generous transfer payments are likely to be, and, just from a selfish point of view, I'm not sure we want to go further down that road.

If, on the other hand, we could get wage growth happening again (and, in an ideal world, reallocate already-existing social welfare spending on the youth and marginally attached from student loans to something less perverse), we might gain a new perspective on this aspect of the problem. We would probably also see an acceleration in household formation, coming back to the first point.

[Frances Woolley]

Erik - I think I'm getting cranky too, because I agree with much of what you say. One quibble, however:

I'm not sure about people who have marginal attachment to the labour force not being involved in household formation. Low fertility is very much an urban phenomenon.

[Benoît]

Interesting article, thank you.

It's easy to test the statistical significance of differences across categories with survey data in Stata. See -help svy: tabulate twoway-.

[Frances Woolley]

Benoît - thanks, I thought that I tried that I didn't manage to get it to work, but obviously I didn't try hard enough. I'm pretty much a rank amateur when it comes to Stata.

It's not always obvious how to set up the svy command correctly for the PUMFs. it's fairly obvious that one starts off svyset [pweight=WEIGHTVARIABLE] but then I'm never sure how to set up the strata variables. E.g. with the EICS, the only geography variable is six regions, so should one do anything with that? What other clusters etc should one set up?

I would *love* to have someone create a list that describes how to do the svyset command properly for the major PUMFs (LFS, national household survey, CCHS, etc). Interested?

[Benoît]

Frances - not really interested, but thank you for the invitation :)

Dealing with Statistics Canada PUMFs can be frustrating. The user guides describe a complex survey design, but users cannot truly account for that design because the relevant variables (stratas, etc.) are not included in the dataset for confidentiality reasons... With the EICS PUMF as with several others, one can only account for unequal selection probabilities by indicating the sampling weight in -svyset-. This yields variance estimates based on linearization methods in Stata, which are approximate (a bit inflated I believe) but acceptable.

Some PUMFs (e.g., GSS) include bootstrap weights to produce design-based variance estimates, and the user guide provides the appropriate syntax for the -svyset- command. The NHS PUMF also includes replicate weights, but in this case Statistics Canada did not bother with Stata's -svyset- and only provided examples of variance estimation with (unecessary complicated) SAS syntax.

We would all benefit if Statistics Canada improved its documentation...

[Frances Woolley]

Benoît, thanks for taking the time to write - it's good to know that I'm not the only one who can't figure out how to match the survey design described in the documentation to the Stata PUMF. I am worried that the PUMFs are a low priority these days at Statistics Canada, and that's a real pity.