…..” We have MORE full-time workers than 2007″, hit them over the head with THIS.
From Investors Business Daily.com By Jed Graham
ObamaCare Cuts Low-Wage Workweek Near Record Low
Here’s something worth paying attention to this Labor Day: The workweek in low-wage industries has fallen back to the historic lows seen at the depths of the recession.
The White House and like-minded economists have disputed the notion that ObamaCare is having a meaningful impact on work hours by noting that the private-sector workweek has recovered pretty much back to where it was in 2007, before the economy tanked.
But that view from 40,000 feet overlooks what is happening in industries likely to feel the brunt of ObamaCare’s employment impact: those in which wages are modest and the ranks of the uninsured are high.
A more rigorous analysis of monthly industry data from the Bureau of Labor Statistics reveals a stark contrast between workers in low-wage industries and the rest of the private sector.
For the 30 million workers in industries where nonsupervisors average about $14.50 an hour or less, the workweek has been shrinking pretty steadily for the past 18 months, reversing a fledgling recovery in work hours.
As of June, these workers averaged 27.7 hours per week — only four minutes more than the record low hit in March 2009.
And preliminary data point to a further decline in the low-wage workweek in July, possibly to new depths. Sectorwide July data show the workweek shrank in both the leisure and hospitality and retail industries, among others. Those two industries alone account for nearly 75% of these 30 million low-wage jobs.
Meanwhile, the 36.9-hour workweek in June for the other 84 million nonfarm private-sector workers remained a full hour longer than the 2009 low and a bit longer than it was before the recession.
As a whole, low-wage industry groups added just shy of 1 million jobs in the 18 months through June, but total hours worked grew one-third slower than payrolls over that span. In effect, the shorter workweek in low-wage industries boosted payrolls by 320,000.
For a profit-making firm facing a 40% federal and state tax rate, the $3,000 annual, nondeductible fine employers may face for each worker who accesses ObamaCare subsidies is equal to $5,000 in deductible wages.
Thus, for a worker earning $15,000 in compensation, ObamaCare could raise an employer’s cost by one-third.
It shouldn’t be a surprise that a good number of low-wage employers in industries with low profit margins have opted to cut hours rather than face such a penalty.
While restricting hours has downsides for business, some employers may see little choice, given that small competitors are free of ObamaCare mandates.
Although penalties weren’t set to take effect until January 2014, employers have had reason to be proactive. For very large employers, adjusting the mix of part-time and full-time workers is necessarily a slow process. Beyond that, fines imposed in 2014 were to be based on staffing levels starting, at the latest, in the second half of 2013.
President Obama in July delayed the penalties for a year, but employers may not let down their guard because 2014 staffing levels will determine 2015 fines.
Recently, IBD highlighted four industry groups with 4.25 million workers (retail bakeries, general merchandise stores, home centers and providers of social assistance to the elderly and disabled) that have seen unprecedented declines in work hours since ObamaCare became law.
The data provided a strong counterpoint to White House claims that a stable workweek in the restaurant sector disproved any negative impact on work hours due to ObamaCare.
What the White House failed to note is that the average restaurant workweek of about 25 hours was already far below the 30-hour threshold at which ObamaCare employer penalties kick in. New part-timers, for example, could be hired at 28 hours per week and raise the average.
Still, some questioned whether the industries singled out by IBD were anomalies. Now, with data covering 30 million workers, any question should be put to rest: Something is amiss with the workweek for low-wage workers.
The decline in the low-wage workweek back toward record lows, together with official data showing fewer people working 30-34 hours per week and a multitude of anecdotal reports of hours being cut, points to a meaningful ObamaCare impact on the workweek.
The trajectory of the low-wage workweek should be a concern, considering that many employers delayed hard decisions amid confusing regulations that were late in coming. Further, employer penalties will keep pace with health insurance premiums, which reliably grow far faster than hourly wages for modest-skill workers. That means the employer mandate’s bite may become more painful over time.
Just last week, we had some moron, I think it was Perez, the Labor secretary, from the Regime try to tell us the number of full-time workers were on the INCREASE despite REAMS of data proving otherwise.
What with the looming implementation of the disastrous PPACA, aka Obamacare, the route MOST employers are choosing to take is one of hiring part-time workers, those traditionally working less than 30 hours per week.
Look for this trend to increase in the coming months, as Obamageddon closes in on small businesses. Couple this with an onerous burden of new regulations, now is NOT a good time to start a small business, or keep one open UNLESS it is you, and a select few others at it.
Toss in this phony “strike” by fast-food workers, aided and abetted by the damnable SEIU, along with the AFL-CIO blessings, looking, in some areas, for a raise in the minimum wage laws to $15 per hour, look for a HUGE increase in the already staggeringly high unemployment ranks among the younger people in the workforce, especially in the inner-cities.
$8 for a Big Mac? Not here. If these activists get their way, and you are an investor in chain restaurant stocks, I’d be heading for the tall grass, with a fistful of SELL orders.