Recent moves by US companies Deloitte and Zoom to reduce how much paid parental leave they offer employees could signal a larger reduction in benefits in corporate America, according to labor market experts.

American workers are already seen as having less benefits and labor protections than many of their counterparts across the world, especially in Europe.

Leadership at huge accounting and communication technology companies likely made the decisions because the labor market has stagnated, meaning that people looking for jobs do not have the same leverage when considering a job opening, the experts say.

But while cutting the benefit might help companies save money in the short term, some consultants argue that the moves will ultimately hurt companies because it will make workers less productive, among other negative consequences.

“It feels like someone is just looking at a spreadsheet saying, ‘How can I get more hours?’” said Bobbi Thomason, a professor of applied behavioral science at Pepperdine Graziadio Business School. But that is “overlooking the fact that there are human beings on the other side and overlooking” the question, “what state are people going to be in when we’re in the office”?

The United States is the only developed country that does not guarantee paid parental leave. The remaining 37 countries within the Organisation for Economic Co-operation and Development offer at least some paid maternity leave, mostly through social insurance funds that are supported by employer, worker and government contributions, according to the Bipartisan Policy Center.

For example, Austria offers 16 fully-paid weeks of maternity leave; Denmark guarantees 22 weeks with an average payment rate of 48%, according to a Syracuse University report.

Still, 13 US states and the District of Columbia have enacted mandatory paid leave systems. Most federal employees are also guaranteed up to 12 weeks of paid parental leave. And last year, US House members introduced bipartisan legislation to establish a program in which the Department of Labor would provide grants to states that establish paid family leave programs through public-private partnerships.

Parental leave policies not only help new parents, but also have larger societal benefits, according to advocates.

Each $1,000 in taxpayer-funded paid parental leave creates more than $20,000 in societal benefits, including increases in the mother and infants’ health and in infants’ earnings in adulthood, according to a study from the Center on Poverty and Social Policy at Columbia University.

“We have seen when people have access to paid parental leave through their companies or publicly pretty dramatic improved outcomes from a health perspective and also from an economic perspective,” said Abby McCloskey, a nonresident fellow in economic studies at the Brookings Institution who has advocated for paid parental leave.

Despite those benefits, Deloitte, which employs more than 470,000 people and generated more than $70 billion in revenue during fiscal year 2025, is reducing its paid parental leave, Business Insider reported.

Starting in January 2027, employees who fall under its “Center” designation, meaning those who work in support roles like administration, IT support and finance, will see their parental leave cut from 16 weeks to eight weeks and will lose a $50,000 adoption and surrogacy reimbursement, which covers in-vitro fertilization treatment.

“Deloitte US is modernizing its talent architecture to provide a more tailored experience reflective of our professionals’ broad range of skills and the work they do serving our clients,” the company said in a statement. “Benefits are regularly updated and will be tailored for a small subset of professionals to better align with the marketplace.”

At Zoom, which generated more than $4.8 billion in revenue in fiscal year 2026 and employs more than 7,400 people, birthing parents now get 18 weeks of paid parental leave, rather than 22 to 24, and non-birthing parents get 10 weeks, down from 16, Insider reported.

“Zoom is committed to employee wellbeing and providing support for new parents,” a spokesperson stated in an email to the Guardian. “We regularly review our benefits to ensure they remain aligned with the marketplace and the long-term health and sustainability of our business. We are confident our overall compensation and benefits package – including our updated parental leave policy – remains competitive and in line with peers.”

Company leaders might have decided to scale back their benefits because the labor market has loosened or there was little adoption of the parental leave offering, said Claudia Olivetti, a Dartmouth College economics professor.

In 2025, the US economy saw almost zero job growth.

Since there are now more people looking for work, companies might not have the same incentive to offer generous paid parental leave, Olivetti said.

Still, even at 18 and eight weeks, Zoom and Deloitte’s parental leave policies are better than many companies. In March 2023, only 27 percent of civilian workers had access to any paid family leave through their employer, according to the US Department of Labor.

But by reducing the amount of leave offered, Deloitte, one of the Big Four accounting firms, “gives permission for other folks to roll things back”, Thomason said.

Still, because Deloitte had offered more leave than many other US companies, “I don’t actually worry about a contagion effect,” McCloskey said.

For Deloitte and Zoom, the cuts could ultimately hurt them.

“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 and people having fewer kids,” McCloskey said.

And for the people impacted, the cuts could change the way they see their employers, Thomason said.

“You’re losing long-term loyalty,” Thomason said. “People may be staying in the office or staying in these roles, 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.”