Obamacare Isn’t Causing an Increase in Part-Time Employment, In One Chart

One of the more baffling messages in the current debate over the economy and “Obamacare” is the hue and cry over the trend in part-time employment. The fact is that since the end of the Great Recession, the trend in part-time employment has been down, not up. The black line in the chart below shows the share of part-time workers in the labor force. The light blue region shows the level of workers who are part-time due to economic reasons. The navy blue region show the level of workers who are part time due to “non-economic” reasons (health, child care responsibilities, etc.). The vertical bars denote recessions, from peak to trough.

During the past two recessions part-time employment clearly increased, while such employment was either flat or falling after the end of the recessions. (Note that the official end date of a recession is the point at which the economy stops getting worse. It does not mean the economy has recovered yet, and the current economy clearly has not.)

In the case of the more recent recession, there are ups and downs after the end of the recession (June 2009) and the passage of health care reform (March 2010, shown in the chart), but the general drift is clearly down. Some point to the slight increase of the past six months, but there have been similar increases and decreases before and after the passage of health care reform. There is nothing noteworthy about the most recent uptick.

Under the Affordable Care Act, employers will be required to provide insurance to workers who work for more than 30 hours a week. This mandate does not take effect for another year. There is no reason why anticipation of it should increase part-time employment in the meantime. And at any rate, such employment has been falling before and after the passage of Obamacare.

For more on this, see articles by Jared Bernstein and Paul Van de Water and Helene Jorgenson and Dean Baker.  For more on the employer mandate, see this post from EPI’s Josh Bivens.

 

Addendum: It’s been pointed out that there are likely employers that are cutting hours to part-time and then falsely blaming the employer mandate when workers complain. This wouldn’t be surprising. The incentive to cut to part-time may come into play in later years, but this is not showing up as an overall trend in the data and there’s no reason to believe it is currently an incentive for employers.


  • http://www.floatingpath.com/ Nick

    Max,

    This is not the correct way to measure the total number of part-time workers. See here:

    http://www.floatingpath.com/2013/09/09/part-time-workers-bls-data-confusion/

    Also, just because the part-time workers to full-time workers ratio is not at its all-time peak does not mean that the Affordable Care Act is not having an effect.

    More on the changes in part-time and full-time workers here:

    http://www.floatingpath.com/2013/09/06/u-s-employment-situation-august-2013/

  • Clark

    Nick, Please learn how to read. Both of these methodologies indicate the same thing. 1. The recession decimated full time employment while exploding part time employment. 2. There is NO relationship between the passage of PPACA and the relationship between full and part-time employment. Anyone with any economic training at all knows not to look at the Lumpy revision prone monthly employment numbers, especially their breakdown. Next years revisions to the Labor Department data will be the most accurate.

    • grgreene

      There is no relation YET because the employer mandate was explicitly delayed for a year. That does NOT imply that it won’t cause a change WHEN it goes into effect. My employer EXPLICITLY THREATENED me (and 2000 other similarly-situated workers — it’s a big employer) with a cutback to 28 hrs/wk and only relented AFTER the delay was announced.

    • http://www.floatingpath.com/ Nick

      Clark,

      Did you even read the post I linked to? These methodologies DO NOT indicate the same thing.

      You seem so confident in your assertion that the passage of the ACA has had no effect on the relationship between full- and part-time workers, yet you bother to include that the current “lumpy” and “revision prone” employment numbers can’t be trusted anyway?