Updated Aug 23, 2013 - 12:41 pm
Is Obamacare a "job-killer"?
A number of recent articles have made the argument that the Affordable Care Act, aka Obamacare, will hurt employment because it will encourage employers to hire part-time over full-time workers. However, both the White House and the Center for Economic Policy Research, a progressive think tank, recently refuted this assertion, pointing to economic data.
Critics of the Affordable Care Act focus on the legislation's requirement that employers with more than 50 workers provide health insurance to all full-time employees — defined as those who work 30-plus hours a week — or pay a $2,000 penalty per worker. This mandate, argue critics, will mean that businesses will be less likely to hire full-time employees.
As the Wall Street Journal put it, the structure of the law "gives businesses that operate on thin margins — and that's most businesses — an incentive to hire more part-time workers."
When White House spokesperson Jay Carney was recently questioned about this possibility, he replied that the argument was not supported by data. "Well, I would say broadly that if you look at the economic data, the suggestion that the ACA is reducing full-time employment is belied by the facts, " he said.
Glenn Kessler at the Washington Post, who followed up with the White House, reported that some of the specific data Carney was referencing were:
■ "According to the BLS Household Survey, 85 percent of the gain in employed workers since June 2009 is due to additional full-time positions. And since Obamacare passed in March 2010, over 90 percent of the gain in employment is due to additional full-time positions."
■ "According to the BLS establishment survey, the average workweek has risen 0.7 hours since the recession ended in June 2009. Moreover, at 33.7 hours, the average workweek has essentially returned to its level at the start of the Great Recession. These developments would not have occurred if employers had cut back on their workers’ hours during the current recovery."
A recent study by the London-based Centre for Economic Policy Research also supported the argument that the employer mandate is not hurting full-time job growth. The study looked at current population survey data regarding workers who work 26-29 hours per week, the margin where one would expect to see an uptick in growth if the Affordable Care Act was impacting employer behavior, from early 2012 and 2013. The survey found that the average percentage of workers in this category actually decreased slightly, from .604 percent to .597 percent.
"While this drop is not close to being statistically significant, the change is in the wrong direction for the ACA as job-killer story," the researchers said.
The employer mandate was intended to go into effect January 1, 2014, using 2013 employer data. However, the Obama administration recently delayed its implementation until 2015. But according CEPR, employers spent the first half of the year under the assumption that 2013 data was going to be used. "Therefore we can assumethat they would have behaved as though they expect to be subject to the sanctions and acted accordingly," CEPR concluded.
Kessler did not to weigh in on the debate, commenting that such analysis may be premature. "Critics may seize on a month’s data here or an anecdote there, but the full impact of the Affordable Care Act ... on employment will not be felt until after it is fully implemented."