Kids back to school – parents back to work? School and daycare opening and parents’ employment in the early phase of the COVID-19 pandemic

Around the globe, the coronavirus pandemic has triggered various reactions of governments designed to contain the pandemic. Among other things, the pandemic led to an unforeseen and unprecedented closure of schools and daycare facilities. In turn, these closures might have forced parents to stay at home to care for their children who could not attend schools or kindergartens. From a social policy perspective, this raises the question of the extent to which parents’ employment has been affected, as time spent on childcare might make parents reduce their working hours. To answer this question, we exploit within-country variations in school and childcare policies across the federal states of Germany to analyse their effect on parents’ working time. In specific, we compare the working time of parents who live in different federal states with different restrictions regarding childcare in a difference-in-differences and difference-in-difference-in-differences framework. Our results reveal a non-negligible positive effect of an earlier and more far-reaching reopening of schools and daycare facilities on parents’ employment. Our results indicate that prolonged closure goes along with negative employment effects for parents. Hence, containment and closure policies to prevent the spread of COVID-19 have substantial economic and social side effects.