Republican opponents of Obamacare ought to feel lucky the October rollout of the program was such a disaster, because their other big gripe about the health-reform law — that it will kill jobs — isn’t coming close to panning out.
Since the Affordable Care Act became law in 2010, Republicans have claimed repeatedly that it would be a job-killing monstrosity, with ample evidence of its withering effect on the economy by now. “The health-care law will cause significant job losses for the U.S. economy,” a 2011 report sponsored by House Speaker John Boehner, Rep. Paul Ryan and other Republicans declared. Well maybe, someday, but in the law’s first month of existence it appeared to have no impact whatsoever on jobs.
The employment report for October showed the economy created 204,000 jobs, far more than economists had predicted for a month dominated by a 16-day government shutdown. Many of those new jobs were in low-margin industries sensitive to the cost of health-care benefits, such as retail, restaurants and hotels. If companies in those industries were worried about Obamacare, they decided not to do anything about it, at least for now.
A notable trend
Another notable trend has been a decline in the portion of part-time workers. Since peaking in July, the number of part-timers has fallen by 955,000, while the number of full-time employees has risen by 186,000. That’s not a big gain economically, but it runs counter to the trend Obamacare critics predicted: A surge in part-timers and a drop in full-timers, as many employers sought to evade new rules requiring them to provide health-care coverage for anybody working 30 hours or more.
It’s still far too early to say with any certainty how the complex new law will affect long-term hiring. The “employer mandate” requiring companies with 50 or more workers to provide health-care coverage or pay a penalty won’t kick in until the beginning of 2015, so employers still have a long planning window to change their hiring practices.
Common sense suggests some companies will probably hire fewer workers once the mandate kicks in, especially those close to the 50-worker threshold that want to remain exempt from the law. Others will probably find they can shave costs by hiring more part-timers and fewer full-timers, though the portion of U.S. companies likely to fit that profile will probably be surprisingly small.
A job creator?
Obamacare could help create jobs, too, and not just for customer-service representatives taking calls from frustrated health-care shoppers unable to navigate the bug-filled Obamacare website. One benefit of the law is it will free some people from sticking with jobs they don’t like simply to get health-care benefits, since they’ll now be able to buy policies priced at a group rate — similar to the rates big companies pay — on one of the public exchanges. That could persuade some people to ditch jobs they’re poorly suited for so they can do more-productive work someplace else, or even start their own business.
It will take years, of course, to understand the full effect of Obamacare on the job market, and even then supporters and critics of the law will interpret the data as needed to buffer their own beliefs. For now, however, the job market seems to be reacting as if Obamacare never happened at all.
Rick Newman’s latest book is Rebounders: How Winners Pivot From Setback To Success. Follow him on Twitter: @rickjnewman.