Babies can understand when a word starts and ends in continuous speech, a phenomenon known as word segmentation
Infants can pick out individual words from language from birth - health short science news

Before infants can learn words, they first have to identify those words in continuous speech. A near-infrared spectroscopy study found that three-day old children can already do so.

The non-invasive imaging study revealed that babies can recognize when a word begins and stops (prosody, the “melody” of speech), and can compute the frequency of when sounds in a word come together.

Thus, even newborns can already listen, although without knowing what the words mean. Nice for the young parents to know!

Read the full story: University of Liverpool
Scientific publication: Developmental Science