Is Obamacare Really Destroying Jobs?

Source: Thinkstock

Source: Thinkstock

Early in 2014, Republicans were running rampant with the damage Obamacare would supposedly do to the economy, throwing around that it could kill more than 2 million jobs. While that number hasn’t been circulating for months, conservatives still argue that Democrats are squashing the stories that expose the decrease in jobs at the hands of Obamacare.

A post on Speaker of the House John Boehner’s site argues that Obamacare is indeed responsible for a large loss of jobs, citing a few stories that the author claims Democrats would rather the public not see. One from Fox News reported surveys by three Federal Reserve Banks in Philadelphia, New York, and Atlanta that said one fifth of employers say they’re cutting back on employment. Health economist John Goodman said, “More than one in ten are saying they’re doing more outsourcing – all this because of the new health care reform.” Last month, The Wall Street Journal reported that the Federal Reserve Bank of Philadelphia’s business survey on the Affordable Care Act showed that 78.8 percent of businesses in the district had made no change to the number of workers they employ as the specific result of ObamaCare and 3 percent were hiring more, but 18.2 percent were cutting jobs and employees. Also noteworthy: About 18 percent had increased the proportion of part-time employees in their businesses.

The Fox News report also cited Doug Holtz-Eakin, former Director of the Congressional Budget Office, who said “for the smaller employers — those that have between 20 and 49 employees — you get a negative impact on jobs, you get a negative impact on wages in those jobs.” That negative impact, he said, could amount to 350,000 jobs — not 2 million, but certainly a good chunk of jobs from the smallest businesses.

Holtz-Eakin’s work with the American Action Forum was the main source for the CNBC article which states that pay at small businesses — again, those with twenty to forty-nine employees — “was trimmed by some $22.6 billion annually because of the Affordable Care Act and related insurance premium hikes.” The American Action Forum’s report says that “ACA regulations and rising premiums have reduced employment by more than 350,000 jobs nationwide, with five states losing more than 20,000 jobs.” Of all of sources presented on Boehner’s site, this is the least anecdotal, as it was built from state-level averages from the Bureau of Labor Statistics.

The other stories cited, though they should not be discounted on this basis, were hyperlocal: Schools in Anderson, Indiana, and Omaha, Nebraska, saw hour reductions to keep part-time employees under 30 hours. While these stories could be an indication of a systemic problem, they aren’t the big numbers.

Beyond the potential cuts, reports claim that there is already a loss in pay in these smaller businesses. And it’s not only the smallest businesses in jeopardy, according to the American Action Forum, which found that employees who work for a business with fifty to ninety-nine employees lose an average of $935 annually due to ACA regulations, while employees of businesses with twenty to forty-nine employees lose an average of $827.50 annually.

Overall, whether it’s too the scale Republicans originally argued or not, the job losses are enough to concern the public, as the even U.S. Chamber of Commerce has reported that Obamacare’s mandates and regulations have put a strain on employers in terms of hiring (particularly concerning full-time workers). Republicans are using this to push legislation that would tweak Affordable Care Act stipulations, including changing the 30-hour rule that burdens those schools. According to Boehner’s site, the bill also will “boost veterans’ hiring by exempting those with existing coverage from ObamaCare’s employer mandate and scrap ObamaCare’s medical device tax that puts thousands of jobs at risk.”

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