Recent moves by US companies Deloitte and Zoom to reduce paid parental leave could signal a larger reduction in benefits across corporate America, according to labor market experts. American workers already have fewer benefits and labor protections than many counterparts worldwide, especially in Europe.
Reasons Behind the Cuts
Leadership at these large accounting and communication technology companies likely made the decisions because the labor market has stagnated, reducing job seekers' leverage. However, while cutting benefits may save money in the short term, consultants argue it will ultimately hurt companies by reducing worker productivity and loyalty.
“It feels like someone is just looking at a spreadsheet saying, ‘How can I get more hours?’” said Bobbi Thomason, a professor at Pepperdine Graziadio Business School. She added that such thinking overlooks the human impact and the state employees will be in when they return to work.
US Context and Comparisons
The United States is the only developed country without guaranteed paid parental leave. The 37 OECD countries offer at least some paid maternity leave, mostly through social insurance funds. For example, Austria offers 16 fully-paid weeks; Denmark guarantees 22 weeks at a 48% average payment rate. Thirteen US states and DC have mandatory paid leave, and federal employees get up to 12 weeks. Bipartisan legislation was introduced last year to provide grants for state paid family leave programs.
Societal Benefits of Parental Leave
Parental leave policies help new parents and have broader societal benefits. A Columbia University study found that each $1,000 in taxpayer-funded paid parental leave creates over $20,000 in societal benefits, including improved health for mothers and infants and higher earnings for infants in adulthood.
“We have seen when people have access to paid parental leave … pretty dramatic improved outcomes from a health perspective and also from an economic perspective,” said Abby McCloskey, a nonresident fellow at the Brookings Institution.
Deloitte's Changes
Deloitte, with over 470,000 employees and $70 billion in revenue, is reducing paid parental leave starting January 2027. Employees in support roles will see parental leave cut from 16 weeks to eight weeks and lose a $50,000 adoption and surrogacy reimbursement. Deloitte stated it is modernizing its talent architecture to better align with the marketplace.
Zoom's Changes
Zoom, with over 7,400 employees and $4.8 billion in revenue, now offers birthing parents 18 weeks (down from 22-24) and non-birthing parents 10 weeks (down from 16). A spokesperson said the company regularly reviews benefits to ensure alignment with the marketplace and long-term business health.
Expert Analysis
Claudia Olivetti, a Dartmouth economics professor, noted that company leaders might scale back benefits because the labor market has loosened or there was low adoption. In 2025, the US saw almost zero job growth, reducing incentives for generous leave. Despite cuts, Zoom and Deloitte still offer more than many companies: only 27% of civilian workers had access to any paid family leave in March 2023.
Thomason warned that Deloitte’s move “gives permission for other folks to roll things back.” However, McCloskey said she does not worry about a contagion effect because Deloitte had offered more than most US companies.
Potential Consequences
The cuts could ultimately hurt Deloitte and Zoom. “It’s unclear to me how much money you would be saving in exchange for the negative publicity, especially when we have fertility rates going down,” McCloskey said. Thomason added that companies lose long-term loyalty: “People may be staying in the office … but these organizations have just burned a bridge, and I don’t think you’re going to be getting the best work from your employees.”
