Obamacare not costing full-time jobs, White House says

The federal government forms for applying for health coverage are seen at a rally held by supporters of the Affordable Care Act, widely referred to as
The federal government forms for applying for health coverage. Credit: Reuters

The White House said on Tuesday there was no evidence President Barack Obama’s signature healthcare program is driving up the number of part-time workers, challenging the view of many business owners in the country.

Conservative Republicans have pointed to the high level of part-time employment as evidence businesses are cutting hours for their staffs in response to the new healthcare law, which will require them to offer health insurance to full-time workers.

And, indeed, one in five businesses in the service sector think the program, popularly known as “Obamacare,” has hurt employment at their firms over the last three months, a National Association of Business Economics survey showed on Monday.

Many businesses polled by the NABE said they were holding back on hiring due to the costs imposed by the law, and the survey also showed 15 percent of service sector firms planned to shift to more part-time workers due to Obamacare.

But economic data on employment has been less compelling.

The number of people with part-time jobs who want full-time work, for example, was essentially flat in September at 7.9 million.

“We are not seeing any effect in the data,” Jason Furman, chairman of the White House Council of Economic Advisers, told Reuters Insider.

Also, the number of part-time workers spiked in 2008, well before Obamacare was enacted, and has been slowly falling as a share of total employment since 2010. In September, people working part time because they could not find full-time work made up 5.5 percent of the employed, unchanged from August.

The spike in 2008 and the steady drift downward since then suggests the elevated level of part-time workers is more likely due to the economy’s weakness.

The issue is a sensitive one for the administration, which is also on the defensive over a clunky roll-out of a website workers use to navigate the new health insurance landscape created by Obamacare.

While many economists say there is a logical reason for employers to cut back on workers’ hours, the pressure to do so this year eased in July when the White House delayed the beginning of Obamacare’s so-called “employer mandate” until January 2015.

Under the mandate, which was previously due to take effect in January 2014, firms with more than 50 employees must provide reasonable healthcare insurance to employees who work more than 30 hours a week.

“Health reform’s employer mandate is likely to have some effect on hours worked, but it hasn’t yet shown up in the data,” Paul Van de Water, an analyst at the Center on Budget and Policy Priorities, wrote in a report earlier this month.

Ron Axelrad, chief executive of Access Staffing, which places part- and full-time employees across the greater New York City area, said his firm had been getting a lot of calls from companies six months ago about how to prepare for Obamacare.

But the delay of the employer mandate has pushed the issue “out of everyone’s mind,” he said.

“Probably toward the second or third quarter of next year, companies will be very aware again that they have to prepare,” Axelrad added.

 


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