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Among the many problems that critics of Obamacare like to highlight, one of the more common is that the health care law undermines jobs and the economy. This was Maria Bartiromo’s theme when she was on NBC’s Meet the Press. Bartiromo, anchor of CNBC’s Closing Bell, said the glitches that have beset the rollout of Obamacare are not the only issue.
"Businesses have changed their plans as a result of Obamacare," Bartiromo said. "We are becoming something of a part-time employment country. We're seeing some groups moved off of health care from business because business is complaining that it's too expensive."
If we boil that down, we have this claim to check: "As a result of Obamacare, we are becoming something of a part-time employment country."
Our research finds Bartiromo’s claim flawed. Not because we don’t have a lot of part-timers. We do.
But the overwhelming driver is a lackluster recovery, not Obamacare. And when you look at the past, the percentage of part-timers has been even higher than it is today.
A closer look
We contacted CNBC and they pointed us to a couple of articles on Bartiromo’s behalf. One from Red Alert Politics, a website affiliated with the Weekly Standard and Washington Examiner, gave examples of companies that have said they will shift or might shift to using more part-time help. They said they would do this to avoid the Obamacare rule that firms of 50 or more employees must offer health insurance to anyone working 30 hours or more. The list included White Castle, the hamburger chain, and Trig’s, a Wisconsin supermarket chain. (The rule, which was supposed to go into effect Jan. 1, 2014, has been delayed by one year.)
Another item was an opinion piece in the Wall Street Journal. The CEO of a company that owns several fast-food chains, among them Hardee’s, made the claim that the "numbers show" that Obamacare is affecting hiring. The proof? The job numbers that came right after the administration announced in early July a one-year delay of the requirement that all larger employers offer health insurance.
"Full-time job creation rebounded and part-time employment subsided," the CEO, Andrew Puzder, wrote. "In July and August, the economy lost 20,000 part-time jobs and added 132,000 full-time jobs."
But that's a historical trend that coincides with the American summer; not necessarily a statement on Obamacare. Between June and August, historically, part-time employment falls and full-time employment increases -- partly because better weather boosts seasonal work in the construction and tourism industries.
Numbers from the Bureau of Labor Statistics show that between 2003 and 2007, the average drop in part-time work was -.28 percent from July to August, while the average rise in full-time employment was 0.2 percent.
It’s also worth noting that the firms that have announced plans to reduce hours for part-timers tend to be in fast food and retail. These industries might have a special reason to keep an eye on the employer mandate in the Affordable Care Act. They tend to use part-timers more than other sectors of the economy.
The average hours worked per week by non-supervisory staff in fast-food restaurants was 25.7 in 2012 and in retail, the figure was 31.6. But for financial services, it was 37.4, manufacturing was 40.7 and construction was 38.8. For fast-food and retail, increasing the use of part-time work could be a viable strategy. That doesn’t mean they represent the entire job market.
It’s the economy
A report from the Federal Reserve Bank of San Francisco puts the current situation into context. The recession drove up the fraction of part-time workers from about 17 percent in 2007 to a peak of 19.7 percent in 2010. It has declined since then. As of the latest data, it stands at 19 percent.
The study’s bottom line is that recessions drive up the fraction of the workforce who are in part-time jobs when they would rather be working full-time. The 1983 recession pushed the share of part-timers to 20.3 percent. That’s significantly higher than the peak for the 2008 recession.
What’s different this time though is that the part-time employment rate has remained higher for many more months than in past recessions. The authors put the cause squarely at the feet of the overall economy.
"The U.S. labor market has recovered only about three-fourths of the jobs lost during the recession and its aftermath, which leaves finding a full-time job still challenging for many workers," they said. "General labor market slack remains the key factor keeping part-time employment high."
The report considers whether the Affordable Care Act could be shaping employers' hiring decisions, but concludes that other factors -- including long-standing IRS rules -- suggest the ACA has not made a significant change.
"Before the law was passed, most large employers already faced IRS rules that prevented them from denying available health benefits to full-time workers. These rules gave employers an incentive to create part-time jobs to avoid rising health benefit costs."
Bartiromo said under Obamacare "we are becoming something of a part-time employment country."
There is anectdotal evidence that some companies are or will reduce the hours of some employees. But those individual instances fail to make a case of moving to a "part-time employment country."
Government numbers actually show that the fraction of part-timers in the workforce has declined since 2010 and in a longer historical perspective, the share of part-timers was less during this recession than in the downturn of 1983.
The argument that the delay of the employer mandate boosted full-time hires is suspect. We see the same trend in previous years well before President Barack Obama was elected.
An independent analysis suggests that the lack of full-time work is the most significant explanation for a persistently high share of part-time work in the labor force.
We rate the claim False.
NBC News, Meet the Press, Oct. 20, 2013
Wall Street Journal, Opinion: Andrew Puzder: Obamacare and the part-time economy, Oct. 10, 2013
Red Alert Politics, White Castle hiring only part-time workers in future due to Obamacare costs, July 25, 2013
Bureau of Labor Statistics, Table A-9, Selected employment indicators, 2003-2013
Bureau of Labor Statistics, Food services and drinking places - Earnings and hours
Bureau of Labor Statistics, Current employment statistics highlights, Sept. 6, 2013
Federal Reserve Bank of San Franscisco, What’s behind the increase in part-time work, Aug. 26, 2013
Wall Street Journal, Don’t blame health law for high part-time employment, Oct. 22, 2013
PolitiFact, Alan Krueger, top economist to Obama, says most new jobs since health care law passed are full time, Aug. 7, 2013
Email interview Paul Fronstin, senior research associate, Employee Benefit Research Institute, Oct. 21, 2013
CKE Restaurants, About
National Bureau of Economic Research, The labor market effects of rising health insurance premiums, Feb. 2005
UC Berkeley Labor Center, Which Workers Are Most at Risk of Reduced Hours under the Affordable Care Act?, February, 2013
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