The law discourages the hiring of full-time employees.
Jillian Kay Melchior
National Review Online
11/8/2012
Job seekers will soon have a harder time finding full-time work, thanks to Obamacare. As of 2014, the law will attempt to force employers to provide insurance — but in doing so, it will have the unintended effect of making part-time employees more desirable than full-timers.
That’s because if a business with more than 49 full-time employees fails to offer insurance coverage, it will be required to pay a fine. And the fine will apply starting not with the 50th employee, but with the 31st. At $2,000 per employee after the first 30, these fines add up fast. A business that surpasses the threshold by just one full-time employee will face $40,000 each year in penalties.
…employers will restrict their current full-time employees to 30 hours a week so that they will be considered part-time under the law. And, of course, some businesses will opt to stay smaller. France provides an instructive example: There, 50 employees is the magic threshold for whether labor regulations apply. And — no surprise — the country “has more than 2.4 times as many firms with 49 employees as with 50,” Jed Graham notes in Investor’s Business Daily.
All this is terrible news for an already bleak labor market. Congressional Budget Office director Doug Elmendorf has estimated that Obamacare as a whole will cost something like 800,000 jobs, and a CBO analysis noted the pressure that many companies will face to hire fewer full-time workers…
The article continues at National Review Online.
Related: Greek Unemployment Rate Hits Record 25.4%
Update: “Affordable” healthcare
It’s open enrollment season for benefits at my employer. Every year I elect to set aside money in a healthcare Flexible Spending Account (FSA). Pre-tax money is taken out of my paycheck to fund this account that is used to pay for uncovered medical costs (co-pays, deductibles, etc.). In essence it takes the money you spend on such medical bills and makes it non-taxable. It makes healthcare slightly more affordable.
This year I elected to set aside $1800 and quickly ran out as my son now requires a whole bunch of special therapies that aren’t covered by insurance. So I was going to set aside the maximum allowed by my employer ($4,000) for 2013 but I just found out that the maximum is now $2500.
The reason is that federal law has now capped such contributions…
