Full time work is about to get scarcer. The reason? By hiring part-time workers who put in less than 30 hours per week, employers can avoid a mandate dictated by the new health reform law: either provide expensive health insurance or pay a fine equal to $2,000 per worker. Avoiding the mandate becomes even more attractive for low-wage employees, since they can get highly subsidized insurance in the newly created health insurance exchanges. According to the Wall Street Journal:
- Darden Restaurants [parent of Red Lobster and Olive Garden] was among the first companies to say it was changing hiring in response to the health-care law.
- Pillar Hotels & Resorts this summer began to focus more on hiring part-time workers among its 5,500 employees, after the Supreme Court upheld the health-care overhaul.
- CKE Restaurants Inc., parent of the Carl’s Jr. and Hardee’s burger chains, began two months ago to hire part-time workers to replace full-time employees who left.
- Home retailer Anna’s Linens Inc. is considering cutting hours for some full-time employees to avoid the insurance mandate if the healthcare law isn’t repealed.
- In a July survey, 32% of retail and hospitality company respondents told [Mercer] that they were likely to reduce the number of employees working 30 hours a week or more.
Clearly the Affordable Care Act (ObamaCare) is a major factor holding back economic recovery. But it’s not alone. Other public policies enacted during the Obama administration’s first four years have been affecting the supply side of the market.