The United States’ lack of a federal paid family leave policy (PFL) is a result of concern about the cost of the policy and the potential negative impact on business performance. However, empirical research on the impact of the policy on firms is sparse. Understanding the financial impacts of paid family leave can shed light on the potential effects on employers. Therefore, through a difference-in-differences analysis, this research analyzed the effect of PFL on business performance metrics. Using return on assets and revenue per employee as indicators, changes in business profitability and productivity, respectively, are assessed. As a result, this research finds that statewide paid family leave policies did not generate statistically significant effects on firm performance.
