Employed or inactive? Cross-national differences in coding parental leave beneficiaries in Labour Force Survey data

In survey research the parental leave beneficiaries are usually coded as either employed or inactive. One of the exceptions is the European Labor Force Survey (EU-LFS), which (from 2006) includes parental leave among other forms of being employed but temporarily not working. This paper explores classification of parental leave takers in EU-LFS, focusing on cross-country discrepancies and their consequences. Our results show that classification rules differ cross-nationally: in some countries parental leave takers are considered inactive, in others – employed but temporarily not working. In particular in the Czech Republic, Estonia, Hungary and Slovakia the EU-LFS data do not reflect the actual use of parental leaves because beneficiaries are coded as inactive. We estimate the actual number of mothers on parental leave in these countries and show that EU-LFS employment rates of women aged 18-40 are biased downwards 2-7 percentage points; for mothers of children aged 0-2 the bias reaches 12-45 percentage points . Our study shows the limited comparability of EU-LFS employment rates, warns about possible bias in cross-national studies and shows the importance of transparent and consistent survey measurement of employment status.