The False Claim That ObamaCare Isn't Costing Jobs

In a recent Washington Post article, Democrat and Obama Economist, Jared Bernstein, along with another lesser known writer said, simply from its title "Yet another inconvenient truth for its opponents: Obamacare is not ‘killing jobs’".  Of course, in the article, they point to facts that support their claim.

Others have pointed out that jobless claims this year have been at 42-year lows despite this being the same year that the employee mandate kicked in.  So, how can it be said that ObamaCare is costing jobs?

The problem is, that jobs are being lost in a way that is not obvious from the employment reports.  As of 2014, 34% of the workforce, or 53 million employees, are contracted labor;  up from just 7% of the workforce or 10 million workers in 2005.  And, up 11 million workers or almost 25% in just one year, from 42 million in 2013.  The real inconvenient truth is that employees are being converted to contractors as employers maneuver to avoid federal and state mandates like matching FICA payments, salaried overtime requirements, and, oh yes, Obamacare.

Also, be aware that when an independent contractor (freelancer) is laid off, he/she is not eligible for unemployment insurance.  Additionally, 4% of our workforce are involuntarily working part-time.  That's almost 50% higher than the traditional 2.7%.  This despite the supposed lowering of the unemployment rate to 5%.  The only rational explanation for this is that employers are avoiding the 50 full time employees rule of ObamaCare by converting full time jobs to part time.

References:

Yet another inconvenient truth for its opponents: Obamacare is not ‘killing jobs’: https://www.washingtonpost.com/posteverything/wp/2015/11/09/yet-another-inconvenient-truth-for-its-opponents-obamacare-is-not-killing-jobs/

How Businesses Are Handling the Obamacare Employer Mandate: http://www.entrepreneur.com/article/239039

Freelancer: https://en.wikipedia.org/wiki/Freelancer

53 million Americans are freelancing, new survey finds:  https://www.freelancersunion.org/blog/dispatches/2014/09/04/53million/

US jobless claims fall 7K, revisit 42-year lows - CNBC.com: http://www.cnbc.com/2015/10/15/us-jobless-claims-fall-7k-revisit-42-year-lows.html

Table A-8. Employed persons by class of worker and part-time status: http://www.bls.gov/news.release/empsit.t08.htm

A Decade's Low Unemployment Claims: Not a Good Thing!

Last Thursday, the average of unemployment insurance claims was the lowest since Nixon was in Office; at least according to one headline.  Of course, this is even more outstanding when you consider the fact that the workforce was 40% smaller when Nixon was in office.

So, why should I be concerned over what seems to be such great news?

The reason is that, as of a year ago, 34% of our workforce were freelancers or independent contractors.  That's more than 53 million workers in 2014; almost double the 27 million freelancers in 2006 when they represented 18% of a smaller labor force of 151 million workers.  And, for sure, the number today is even higher than last year's 34%.  But, a critical point point to make is that these workers are not eligible for unemployment compensation whenever their services are no longer needed by a company.

Thus, we would probably have higher unemployment claims today if it weren't for the fact that a full one-third of our workforce is now self-employed.

Sadly, this is a growing trend as companies try to avoid the heavy burden of higher employment costs such as the employer mandate of ObamaCare; higher minimum wages in 29 states than the federal $7.25 an hour; and, Obama's new overtime rule for salaried workers.

It is now estimated that 40% of the workforce will be forced into a role of self-employment by 2020.  Not a good thing for the American worker and their families.  Thanks to over regulation of businesses, job security is vanishing in this country,.

References:

Jobless claims average hasn’t been this low since Richard Nixon: http://www.marketwatch.com/story/average-jobless-claims-havent-been-this-low-since-richard-nixon-2015-10-01

One in Three U.S. Workers Is A Freelancer: http://blogs.wsj.com/atwork/2014/09/04/one-in-three-u-s-workers-is-a-freelancer/

40% of America's workforce will be freelancers by 2020: http://qz.com/65279/40-of-americas-workforce-will-be-freelancers-by-2020/

How many freelancers are there? In 2006?: http://freelancersmovement.org/how-many-freelancers-are-there/

Labor Force Size By Year: http://www.dlt.ri.gov/lmi/laus/us/usadj.htm

State Minimum Wages | 2015 Minimum Wage by State: http://www.ncsl.org/research/labor-and-employment/state-minimum-wage-chart.aspx

Obama's new overtime rules: How they'd work and who they'd affect:  http://www.latimes.com/business/la-fi-obama-overtime-rules-explainer-20150630-htmlstory.html

Biden: the Middle Class Is Being "Killed"

Recently, Vice President Joe Biden, said that the middle class is getting "killed" and we need constant and reoccurring infrastructure spending to restore it:

He's right about the middle class getting "killed".  Just look at this chart of real (adjusted for inflation) median household incomes:

As you can see, the so-called Great Recession took its toll.  But, it is also true that 6 years of Obama (and Biden) has not done one thing to improve the median income.  This despite a near trillion dollars in "Stimulus" spending and other programs that were supposed to help the middle class.

So, this brings us to the question as to whether or not Biden's (and Obama's) insistence that infrastructure construction spending will strengthen the middle class.

Well, the answer to that question is no.

In order to raise median household income above the $52,000 level (as seen on the above chart), you need to create a lot of jobs that are well above that number.   Unfortunately, that isn't going to happen with infrastructure projects.  The best paid job on any site is the construction supervisor.  The average construction supervisor salary is about $49,000; or, $3000 below $52,000. The next best paid infrastructure jobs are the heavy equipment operators.  Their average pay is around $41,000.  From that point on, it is down hill until you get to the low-paid individual that controls traffic by flipping around a "stop/slow" sign all day long.  Also, understand that infrastructure construction jobs only make up a small percentage of the workforce.  For, example, there are only about 400,000 equipment operators in this country out a of labor force that is made up of 157 million.  That's less than 2-tenths of a percent of the labor force.

The only reason that Biden and Obama are pushing infrastructure spending is to benefit their union voting block because most heavy construction work in this country is unionized.

The kind of jobs that would strengthen the middle class are managers, lab and medical technicians, research scientists, nurses and nurse practitioners, engineers, programmers, and so many more jobs that have nothing to do with infrastructure.  But, these jobs are being hurt by the heavy hand of government regulation under the Obama Administration.  The best proof of that comes from the massive growth in independent contractors and freelancers.  Right now there are 42 million of them, but that number could be more than half of the salaried workforce of 135 million by 2020.

By hiring independent contractors and freelance workers, companies avoid all kinds of federal and state mandates such as the matching FICA payments, minimum wage, paid family leave, salaried overtime pay, and, especially, not having to pay the fine for not providing healthcare.  Instead, the contractor or freelancer must pay for their own health insurance and prepare for their own retirement.  This is what most Democrats don't seem to understand as they keep boxing companies in with increasingly burdensome regulations.


References:

Construction Equipment Operator Quick Facts: http://www.bls.gov/ooh/construction-and-extraction/construction-equipment-operators.htm

Salary Data: Construction Supervisor: http://www.indeed.com/salary/Construction-Supervisor.html

Browse Average Salary Ranges for Middle Income Level Jobs: http://www1.salary.com/Middle-Income-Salaries-7.html

The Shifting American Workforce: Growing Legions of Freelancers and Independent Contractors: http://www.inquisitr.com/1419404/the-shifting-american-workforce-growing-legions-of-freelancers-and-independent-contractors/

We're all becoming independent contractors: http://www.baltimoresun.com/news/opinion/oped/bal-were-all-becoming-independent-contractors-20150224-story.html

Jobless Claims at 14-Year Low: Because of ObamaCare?

Does anyone really think the current economy and job market is as good as it was in 2007 when the unemployment rate was at the historically low level of 4.6%?  So, then, why was the Labor Department able to report that the weekly jobless claims number, at 264,000, reached a 14-year low?  Truly, an unbelievable drop of 23,000 in a single week.  This despite the fact that the current unemployment rate is 1.3 percentage points higher than it was in 2007 at 5.9%.

Two things might explain this.

First, we could be seeing "number manipulations" in the run up to the November 4th elections.  Let's not forget that Obama's Census Bureau was caught doing just that very thing before the 2012 elections.  Therefore, there is no reason not to think that his Labor Department couldn't be doing the same with the unemployment claims number.  Having a multi-year low in claims, with the mid-term elections only 2-1/2 weeks away is quite a coincidence.  And, like the last time, the number juggling probably won't be exposed until months after the election.

The other reason might be the direct result of an increasing trend by American businesses towards hiring fewer full-time workers; and going with temporary help instead, or using temp services, contract labor, freelancers, consultants etc.  All of which are not eligible for unemployment benefits when their services are no longer needed.

You can blame this trend of not hiring full time workers on ObamaCare.

Under the ObamaCare law, a business  must provide health insurance to its full time employees or pay a tax (really, a fine) if it has more than 50 employees, all of which are working at least 30 hours a week.  Hiring temporary help or contracting outside labor can easily keep small businesses and franchisees from reaching that 50 full-time worker threshold. It also means they don't have to subsidize FICA, unemployment insurance, or provide benefits such as paid vacations and pensions.

While some economists and politicians might think that lower jobless claims is a good thing, it may be the result of a growing trend towards avoiding employer-provided health insurance.  Something that one of the chief architects of ObamaCare, Ezekiel Emanuel, recently predicted.

So, now we have a healthcare law that was supposed to increase the number of insured but, instead, is doing just the opposite.  At the same time, it is putting American workers at risk because fewer of them will be eligible for unemployment benefits when laid off. 


References:

November 16: New Jobless Claims Fall to Lowest Since 2000: http://www.nytimes.com/2014/10/17/business/economy/new-unemployment-claims-fall-to-their-lowest-since-2000.html


US companies increasingly turning to temporary workers to fill positions: http://www.foxnews.com/us/2013/07/08/us-companies-increasingly-turning-to-temporary-workers-to-fill-positions/

For Many Americans, 'Temp' Work Becomes Permanent Way of Life: http://www.nbcnews.com/feature/in-plain-sight/many-americans-temp-work-becomes-permanent-way-life-n81071

Temporary jobs becoming a permanent fixture: http://www.usatoday.com/story/money/business/2013/07/07/temporary-jobs-becoming-permanent-fixture/2496585/

Labor Force Statistics from the Current Population Survey: http://data.bls.gov/timeseries/LNS14000000

Census 'faked' 2012 election jobs report: http://nypost.com/2013/11/18/census-faked-2012-election-jobs-report/

Obamacare architect: Law will cause ‘the end of employer-sponsored insurance’: http://dailycaller.com/2014/03/20/obamacare-architect-law-will-cause-the-end-of-employer-sponsored-insurance/