BCG: Companies Offering Paid Family Leave Say Benefits Outweigh Costs


A study of 250 companies with recently introduced or expanded paid family leave policies reveals, for the first time, that a wide range of employers are seeing multiple benefits that outweigh the costs. The findings are included in a new report from the Boston Consulting Group, “Why Paid Family Leave is Good Business.” 


The study shows the benefits of paid family leave include a greater ability to attract and retain talent; improved employee morale, engagement, and productivity; diversification of company leadership teams; and better alignment with company values. While more and more companies are leading on this issue, the report notes that overall coverage of the U.S. workforce remains low, with just 14 percent having access to some form of paid family leave.

“The companies we reviewed see a compelling business case for providing or expanding paid leave to employees who take time off to care for a new child or an ill family member,” says Trish Stroman, a BCG Partner and coauthor of the report. “Some of the recent movers are in sectors that might be surprising, including retail and hospitality. We also found that companies are able to design policies that meet the needs of their diverse workforce—from headquarters to the manufacturing plant to the retail outlet.”

The report describes a trend toward more-inclusive policies—going beyond maternity leave for birth mothers to cover all parents, for example, as well as birth, adoption, and surrogacy and both salaried and hourly workers. A few companies also provide paid leave to care for a seriously ill family member, ensuring that all employees, and not just parents, have equal access to the benefit.

The report is based on an examination of family leave policies at more than 250 companies, as well as in-depth interviews with 25 HR leaders at large organizations, and was prepared by authors at BCG and Panorama. While the exact benefits of paid family leave can be hard to measure, the companies included in BCG’s research reported a positive return, particularly relative to other employee benefits they could provide. For many companies, the costs of providing the benefit were also lower than expected.