State Policies That Affect Working Families

Assessing the New Federalism Discussion Paper No. 04-05

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

Note: This report is available in its entirety in the Portable Document Format (PDF).

We've split [working mothers] in two, but haven't put them back together. We need to find a way to reorganize and give them back some of their life. T. Berry Brazelton (as quoted in Jennifer Huget, "The Good Disciplinarian," Washington Post May 12, 2003.)

Project Background and Goals

Recently, employees and employers have struggled to develop working conditions that help parents manage their market and caregiving responsibilities. As the number of employed parents with young children has increased, so has the need for benefits such as family leave, child care, and workplace flexibility. Family policies have benefits and costs to both parties. For example, policies that give workers flexibility to tend to their families' needs often result in wage loss. And although these flexible policies enable employers to retain valued employees, the retention often results in temporary productivity losses.

Government can play an important mediating role in the work/family tensions faced by many employers and employees. Public policy determines, to some extent, what family policies an employer offers its workers. The federal government has enacted laws aimed at stabilizing parents' employment and reducing the costs of going to work for families with caregiving responsibilities. The Family and Medical Leave Act allows some workers to take job-protected leave to attend to certain family needs, and the Child Care Development Fund provides child care subsidies for families with young and disabled children. Some tax benefits help parents offset some of the costs associated with working.

The difficulties associated with balancing work and family responsibilities may be more pronounced for low-income families. On average, these families have less flexible jobs and positions with fewer benefits (Heymann 2000). They also have less income to purchase needed services such as child care. While some national family policies are targeted at helping low-income working parents (e.g., the Earned Income Tax Credit and the Child Care Development Fund) others tend to reach predominantly higher income families (e.g., the Family and Medical Leave Act and flexible spending accounts).

Many states have developed family policy programs that fill some of the provision gaps created by private and national policies. This report is a compilation of state policies that support working parents, particularly those from low-income families. The state-level policy data is arrayed along four dimensions:

• Job-protected family care policies provide some job security to working caregivers.
• Child care subsidies can reduce the costs of child care and may enable recipients to purchase higher quality care.
• The availability of early childhood education and elementary school schedules can influence the work schedules of parents with young children.
• Tax credits, including state-level earned income tax credits and dependent care tax credits, help offset the costs of going to work for caregivers and may increase economic well-being. Tax incentives for employers to provide or subsidize child care can both increase the availability and reduce the cost of care.

The compilation of state level policies is not comprehensive. Rather, it provides a summary of key policies in each of the four areas that should be useful for future research endeavors.¹ I identified policies for inclusion in this report based on four criteria: (1) theory and/or empirical research suggests a positive relationship between the policy and employment or economic well-being;² (2) states vary significantly in their policy provisions; (3) information about the policy is readily available from secondary data sources; and (4) the policy is easily measured and converted to an indicator or indicators. As a result, some key policy areas are not included in this report. For example, although public health insurance programs are critical for many low-income families, data about state health insurance programs are not included owing to policy complexity and an unclear relationship with employment.³

The conclusion discusses possible avenues for future state policymaking. For example, job flexibility provisions that allow parents to have more control over their work schedule continue to be debated at the state level, but legislation continues to be targeted at small segments of the working population. The remainder of the report is divided into four sections and a conclusion. Each section begins with a discussion of the benefits of the policy type for both employees and employers. Next, any federal role in the policy area is highlighted, as are any special state innovations. Detailed tables outlining specific state policy provisions follow a brief description of each policy cataloged.

While this report does not analyze state legislation, the tables and summaries draw attention to many facets of the policies. State family policies vary along a number of dimensions, including the extent to which the policies target certain populations (e.g., low-income families); how much the policies redistribute resources and to whom (e.g., from non-parents to parents, from higher- to lower-income families, from smaller to larger families); the size of the population that the policies reach and whether they have eligibility criteria or are universal; the value of the benefit the policies provide; the degree to which the policies restrict employer or employee choices; whether the policies promote gender equity; and the policies' administrative methods. Future work will analyze some of this variation and link it to measurable outcomes, such as access to leave.

Notes from this section

1 I would like to thank Elen Galinsky and Jody Heymann for their suggestions about the policies to include in this report. The final selection of the policies rests with the author and does not necessarily reflect Drs. Galinsky and Heymann's preferences.

2 Policies designed to mitigate the tension between work and family responsibilities are not necessarily child-friendly. For example, providing emergency child care for sick children helps working parents maintain their employment, but an unfamiliar child care provider and setting may not be the best option when viewed from the sick child's perspective.

3 The Kaiser Family Foundation publishes detailed compendiums of state Medicaid policies and State Child Health Insurance Programs.

Note: This report is available in its entirety in the Portable Document Format (PDF).

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

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