Essential Benefits: Paid Family Leave

With more workers balancing jobs and caregiving, offering paid family leave can help employers support worker well-being and key business outcomes.

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By Jin Woo Chung, Matt Bahl, Necati Celik, Ph.D.

Category:

Benefits, Equity, Generations, Workplace
Tags:

Caregiving, Women

Tuesday, November 18, 2025

An Essential Benefit That Strengthens Worker Financial Health and Workforce Performance

Caregiving is reshaping the American workforce. Nearly 1 in 4 workers provides unpaid care to an aging parent, child, or family member with a disability or chronic illness.¹ Yet unlike most developed countries, the United States has no national paid family leave program, leaving workers reliant on employer policies or a patchwork of state-level programs.²

This gap carries serious financial consequences for both employees and employers. Without paid leave, workers often lose income, drain savings, or exit the workforce entirely.³ Recent Financial Health Network research on worker benefits showed that access to paid family leave is linked to stronger financial health, including a 5-point increase in FinHealth Scores and greater resilience across savings, debt management, and long-term planning.⁴

Paid caregiving leave also strengthens employers’ bottom lines by reducing turnover, improving productivity, and boosting talent retention – making it a strategic investment in workforce and economic stability.⁵

What You’ll Learn

Read the full brief to explore how paid family leave bolsters employee financial health and employers’ performance – and how to design an effective paid leave program.

Discover how paid family leave helps workers stabilize income, avoid high-cost debt, and preserve emergency savings.

Understand the business case for paid leave, including real employer cost savings and long-term workforce resilience.

Learn which key design features – like benefit duration, eligibility rules, and return-to-work flexibility – drive the greatest impact.

Why Paid Family Leave Policies Are Good for the Economy

Expanding access to paid family leave helps keep more employees – particularly women and caregivers – in the workforce. Compared with Europe, Canada, and Australia, the U.S. has a significantly lower rate of working-age women in the labor force.⁶ The economic impact is significant: If the U.S. adopted policies similar to other advanced economies, it could add 4.85 million women to the workforce and boost the nation’s annual GDP to $775 billion.^7,8

Our Supporter

JUST Capital commissioned this report to identify key trends relating to the state of retirement security for a workplace audience. The insights and opinions expressed in this report are those of the Financial Health Network and do not necessarily represent the views or opinions of our partners, funders, and supporters.