Obamacare hasn’t killed full-time jobs, either
When we last looked at Obamacare as an alleged “job-killer,” Matt Yglesias had just pointed out that 2014, the first full year of insurance on the exchanges, was also the best year for job creation since 1999. But recently a non-blogging friend reminded me of a related anti-Obamacare meme, the idea that employers have been cutting their workers below 32 hours per week so they would not have to provide them with health insurance. His argument was, logically enough, that this would mean a loss of full-time jobs.
As with so many other anecdotal Obamacare horror stories, this one does not stand up to even simple inspection. Just like total job creation, it turns out that full-time (BLS uses 35 hours/week, not 32, by the way) job creation has quickly increased since December 2013, just before exchange insurance went into effect. Not only that, part-time employment has fallen slightly. The Bureau of Labor Statistics’ monthly “Employment Situation” (Table A-9 in both cases) tells the tale.
Date Full or Part Time Not Seasonally Adjusted Jobs Seasonally Adjusted Jobs
December 2013 Full-time 116,661,000 117,278,000
July 2015 Full-time 123,142,000 121,589,000
Change + 6,481,000 + 4,311,000
December 2013 Part-time 27,762,000 27,372,000
July 2015 Part-time 26,850,000 27,265,000
Change – 912,000 – 107,000
I included both seasonally adjusted and not seasonally adjusted data for completeness sake, but when we are comparing a summer month to a winter month, surely the seasonally adjusted figures are the correct ones to use. For those of you keeping score at home, then, full-time jobs have increased by 4.3 million since Obamacare exchange insurance went into effect, whereas part-time jobs have fallen by 107,000. Neither of these fits the anecdotes of workers being shunted from full-time to part-time work to avoid providing insurance. This increase in full-time work has been accomplished in the span of just 19 months, or an average of over 226,000 new full-time jobs per month.
Of course, it’s theoretically possible that using sophisticated statistical controls might uncover a hidden negative relationship; that we’d have even more full-time jobs than we do if the exchanges hadn’t gone into effect. Even if that were true, it’s obvious that everything else going on in the Obama economy is having a much bigger effect on full-time employment, so there’s no justification for using the epithet “job-killing” on the off chance that it’s true.
Cross-posted from Middle Class Political Economist.
You DO know that the employer mandate has not really gone into effect, right?
Almost all companies with more than 100 employees already offer health insurance. http://www.politifact.com/truth-o-meter/statements/2013/sep/18/chris-van-hollen/van-hollen-says-employer-mandate-affects-5-busines/
And the president is refusing to enforce the mandate on smaller companies until next year. http://obamacarefacts.com/obamacare-employer-mandate/
Warren, 70% of all employees are employed by companies larger than 100 employees which are already under the mandate. If you are going to find your part-time effect, you are going to have to find it in an ever smaller portion of the workforce.
And if small employers were making shifts to part time, there would already be signs of it in anticipation of the 2016 deadline. Employers must send out 2016 health plan options to employees next month.
https://www.businesscycle.com/ecri-news-events/news-details/economic-cycle-research-ecri-cheap-labor
As I mentioned, Bill, nearly 100% of people in those over-100-employees companies were already insured prior to Obamacare, so the mandate had no practical effect.
Since Obama has repeatedly refused to enforce the law, why anticipate that he will enforce it in the future? They can change employees’ status when he does.
Employers also knew that the Minimum Wage increases were coming in July 2007, but they did not cut employees until it actually went into effect.
Warren, you don’t have just pull numbers out of your … uh, hat. The Kaiser Foundation has been tracking this for years.
Table 3.1 of this PDF shows that in 2014, the first year of the ACA, and before the mandate, the overall rate of coverage by employers is 55%, broken down as a rate of 62% for large companies and 44% for small companies.
Not your “100%” number at all. Yet in 2015, we haven’t seen a shift in full-time to part-time by large employers, even with the mandate.
Time will tell, but if 2015 is a guide, 2016 won’t see much of a change either.
https://kaiserfamilyfoundation.files.wordpress.com/2014/09/8625-employer-health-benefits-2014-annual-survey6.pdf
BiilB,
See page 42, exhibit 2.2 Roughly 99% of large firms already offer coverage.
Exhibit 3.1 shows percentage of workers covered by their employer by firm size. That is a different statistic. For instance, the company I work for offers coverage, but I do not take it as I am covered by my wife’s plan.
Hi Mike,
Exhibit 2.2 shows the percentage of companies that offer health care to at least some of their employees, which could be for example, only white collar or executives. Nearly all large companies provide insurance for some of their employees, but other employees in the same company could be excluded from coverage.
You want to look at Exhibit 3.1 to see what percentage of employees are actually covered by insurance and it shows that large companies only cover 62% of their employees.
If you want to find out the percentage that are offered insurance but do not accept it, then you need to look at Exhibit 3.2, but keep in mind that exhibit only looks at companies that do offer insurance. So even for large companies that offer coverage to some employees, only 76% are eligible for coverage.
So going back to Warren’s original statement, it isn’t true that 100% of large company employees were offered insurance back before the mandate. At best it was around 76%. Now all of those employees are covered by the mandate, yet we don’t see an increase in shifting from full time to part time.
Hi Bill, thanks for the clarifications!
BillB,
But none of the links tell us why some workers at companies that offer plans are not eligible. The politifact link in Warren’s first post, discusses several reasons why a worker might not be eligible (still within waiting period, works only part time, etc.) but doesn’t nail it down.
Did delaying the employer mandate have an effect on workers? Some say no because large employers already offer coverage, others say yes because a significant portion of workers at large companies are not covered. I cannot tell which is correct from the data provided in the links. Politifact rates it mostly true that the delay will have little impact on the overall goal of the health care reform law.
Will those working at large employers and who are not now eligible for coverage become eligible once Obamacare fully kicks in? if politifact and Van Hollen are correct, they may not since the employer mandate is said to affect only about 5% of businesses (those with more than 50 full time employees and who are not now offering coverage). Time will tell.
It sounds as though you are disagreeing with Van Hollen and Politifact and that you expect Obamacare will have an effect on the percentage of workers at large firms who are eligible for coverage. If that is so, then you ought to disagree with the OP ( to an even greater extent than others who foresee Obamacare mostly affecting employment decisions of smaller firms) and argue that it is premature to make conclusions about Obamacare’s effect on full time vs part time employment because the employer mandate has not kicked in.
BillB,
I reread your post at 9/4 10:05PM and see you already stated your opinion on whether the rate of part time vs full time in large employers will change. As you say. It didn’t in 1st year of mandate for large
employers , but time will tell. How then will the rate of eligibility change (to increase hopefully) in large employers?
Lastly one year of data for large employers under the mandate is hardly a trend, and we have no data for small employers as the mandate was delayed for them, so I remain in the camp that says it is too soon to tell if there is a part time vs. full time effect. .
Ya gotta love these endless attacks on the ACA and the patterns they constantly follow:
“The ACA is going to do this bad thing”…..
Then when it is shown that the ACA did not do this bad thing…
“It is too early to tell”…..
EMichael,
Do you mean claims such as “If you like your health plan, you can keep your health plan” or the claim that PPACA mandate is not a tax, until it was a tax?
The history of this legislation suggests it is best to wait and see what pans out.
Mike:
Heh, heh. It always amazing me how Republicans and Tea-baggers can distort what was really said and then expect to walk away unscathed. “Back in June of 2010, Health and Human Services Secretary Kathleen Sebelius held a press conference to announce that, under Obamacare, millions would be moving to new plans. As I point out in this post, a HHS press release spelled out the numbers: “roughly 42 million people insured through small businesses . . . along with “17 million who are covered in the individual health insurance market.”
And here: Obama first made that pledge in 2008, while debating John McCain. The context is crucial: Obama was addressing “the majority” of Americans (roughly 66% ) who worked for large companies that paid 75% to 80% of their premiums – not the minority who purchased their own insurance in the individual marketplace (5%), nor the 17% who were insured by small business owners.
“So here’s what my plan does. If you have health insurance, then you don’t have to do anything. If you’ve got health insurance through your employer, you can keep your health insurance, keep your choice of doctor, keep your plan.” http://angrybearblog.strategydemo.com/2014/02/why-are-so-many-americans-confused-about-obamacare-how-a-video-produced-by-cbs-washington-bureau-misled-millions-part-1.html#sthash.YsfxPHFN.dpuf You really need to read this guy as he is credible. Any questions as to who said what? It is easy to distort what was said and what was promised and you should know better.
I see no reason for the delays in implementation not to happen. The waivers and delays were done so citizens and small business could get on line with the changes.
Either way, President Obama has refused to enforce the law, and there are people who do not have insurance because of his refusal to enforce the law he signed.
No, President Obama has not refused to implement certain aspects of the PPACA. He has delayed them or granted extensions to implementation. Why is such so bad? It is only bad if you are a part of a minority who wish to see the PPACA fail so as to do “nothing” or implement another plan one of which was blocked by a legislature with their special interests and a Senator from Aetna. It will move forward.
We agree on the last sentence.
That is what I have been doing. Unlike the other side which tries to make mountains out of molehills, then counsels patience when the molehill is evident.
Warren,
How many people are you talking about?
Meaning no offense, but if I worked fro a small business that did not offer insurance I am pretty sure I would have gone into the exchange to get it. And then perhaps when the mandate arrives, I can change course.
Course, if I was such a worker I would hoping the mandate does not go into effect, cause insurance through the exchanges is much cheaper than comparable employer provided insurance plans. And the lower the income, the cheaper the price.
It does not matter how many people I’m talking about. Justice delayed is justice denied. It’s bad if you work for one of those companies.
If this mandate supposedly would not hurt companies, why the 773H would Obama refuse to enforce the mandate HE SIGNED!?
Yes, while the OVERALL cost of insurance is higher with an employer-sponsored plan, most employer-sponsored plans are mostly paid by the employers.
Warren:
As I said, Obama has not refused to implement or enforce the mandate the PPACA with employers of 50 to 99 employees. He has delayed it. This is similar to people claiming Obama gave companies forever waivers from meeting PPACA requirements. What is your point here?
Paid by the employers?
Out of the goodness of their hearts?
“C’mon, Man!”
The POINT here is that people are going TWO YEARS longer w/o insurance because Obama has refused to enforce the law that HE SIGNED.
Warren:
If there is no insurance, they have the option of going on the healthcare exchange. If there is insurance for those companies with 50 to 99 employees, the companies were granted a waiver to get in compliance. If they do not the waiver ends and the penalty starts. There is no refusal to enact the law.
Warren:
1. There was no refusal, there was a waiver, a delay in implementation.
2. The delay was meant to allow some smaller companies get into line with the PPACA requirements. As you can see by the image 92% of small firms 51 to 100 in 2011 were already compliant. This is the group being discussed.
3. People are still able to get the same on the PPACA healthcare exchange.
Of course it’s not out of the goodness of their hearts. Neither is paying their employees at all. They do it to stay competitive in the labor market.
Well then why did you say “most employer-sponsored plans are mostly paid by the employers.”?
And once again I ask, why would such a person not have insurance considering the exchanges were available and cheaper than the comparable insurance their employer would have offered them if the mandate had been implemented?
And once again,
Ya gotta love these endless attacks on the ACA and the patterns they constantly follow:
“The ACA is going to do this bad thing”…..
Then when it is shown that the ACA did not do this bad thing…
“It is too early to tell”…..
The sky is falling. . .
If your assertions about cheaper insurance on the exchange were true, then there would be no reason for the employer mandate in the first place.
Warren:
Where did I say cheaper and indeed it could be cheaper dependent on salary and number of dependents. They might also be able to reap the benefit of a Silver Plan deductible coverage if their income is low enough after taking into consideration dependents.
“As you can see by the image 92% of small firms 51 to 100 in 2011 were already compliant. This is the group being discussed.”
No, it’s the 8% that were NOT in compliance that are being discussed.
The law does not give the president the authority to delay enforcement. The law says that they were to be in compliance by January, 2014, or be penalized. PERIOD. The law was signed In March of 2010. They had more than three-and-a-half years to get into compliance.
So WHY has the president refused to enforce the law?
Warren:
Waffling and deflecting as usual. There was no refusal. The grouping of small companies being discussed was the 51 to 100 employees of which the vast majority were compliant. 8% were not compliant. These particular companies may not have the resources or the understanding in which to comply so they were granted extra time. The President can grant additional time to comply administratively. Granting the time administratively is not a refusal to enforce the law the same as any judge granting time to a defendant to comply.
Seriously? THREE-AND-A-HALF YEARS is not enough time?
Warren:
Deflecting again? I see 2-1/2 years from July 2013. Perhaps, you have a different date the deferral began? The percentage is 95% of employees starting January 2016 and at that point the companies will be subject to penalties. 96% of all companies are < 50 people and 2% are withing the 50 to 100 employees. Certainly, this is not a show stopper. While I consider you to be a relatively intelligent poster, you are starting to take on troll like attributes. Much of what you have said is anecdotal and a repeat of previous comments. It is time to give it up. I appreciate your vigor; but, continuing this does nothing for your position. Most here would continue to answer you. I happened to have written on the topic on many occasions.
I see March of 2010 as when the law was signed. The mandates were not to go into effect for another THREE-AND-A-HALF YEARS, in January of 2014.