Latest ObamaCare Delay Confirms That The Healthcare Law Is A Job Killer

Ever since ObamaCare was passed into law, non-partisan economists have labelled it a job killer.  In doing so, they point to the fact that employers can avoid any mandates and penalties by converting full time workers to part-time and by keeping the full-time staff under 49; a simple task if you are able to convert those employees to outside, contract  labor.  Other economists believe that struggling companies, unable to either provide insurance or pay the penalties, will have no other choice but to shutter their businesses.  Others point to higher costs and new taxes associated with the law as potential drags on the economy with job losses to follow.

Those on the left have countered this by pointing back to the original Congressional Budget Office's analysis of ObamaCare which said that an insignificant amount of jobs (800,000) would be impacted: that being only one-half of one percent of the total workforce.  Further, the proponents of the law have noted that the benefits to the overall economy would be greater than any small number of jobs being lost. Some even argued that it would actually create jobs.

Well, a funny thing happened on the way to rolling out ObamaCare last week.  This time, in the 29th such delay, Obama told employers with 50-to-99 employees that their compliance with the law was delayed until January 1, 2016.  Or, that's what most of the news media reported.  What was little reported is that an employer has until that date to comply "as long as" that employer signs an affirmation, as part of each and every tax submission, that says that any changes they might have made in staffing were not a result of trying to avoid the mandates of ObamaCare.  Otherwise, if they lied, they would be subject to both penalties and imprisonment for perjury under Federal law.  Now, if that doesn't backhandedly scream proof of  job-killing, I don't know what does!

Obviously, the delay and the associated "perjury" condition is intended to stop any further deterioration of the workforce in advance of the November elections. I'm quite sure that the President's economic advisers have told him things like, in the last year, 75% of the jobs being created were part-time.  Or, that productivity has risen and unit labor costs have fallen to levels that haven't been seen since the last two recessions.  Or, that the decline in retail sales is closely following the pattern that preceded the last great recession in late 2007.

Any way you shake it, the Presidents signature legislation is harming both the economy and jobs; and, this latest delay and that "affirmation" just proves it.

References:

Businesses must certify under penalty of perjury that job cuts aren’t Obamacare dodge: http://www.washingtontimes.com/news/2014/feb/11/businesses-must-certify-under-penalty-perjury-job-/

CBO: Healthcare to Shrink Workforce by 800,000: http://www.politico.com/news/stories/0211/49273.html

Chart: Productivity and Unit Labor Costs: http://www.briefing.com/Common/Images/Content/PageContent/EcData/prodann.gif

Chart: Retail Sales: http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2014/02/Retail%20Sales%20Control%20Group_0_0.jpg

 75% Of Jobs Created This Year Were Part-Time: http://jobs.aol.com/videos/business-economy/75-of-jobs-created-this-year-were-part-time/517905414/

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Productivity Increases: Proof That ObamaCare Is Behind Weak Job's Reports?

Each quarter, the United States Bureau of Labor Statistics (BLS) measures worker efficiency in a report titled: "Productivity and Costs".  Normally, increases in productivity are a good thing because it shows that the workforce is producing more goods on a lower per-person basis, thus reducing the costs of items being produced and making those items more competitive; especially against low-cost world markets.

But, when productivity increases at a faster rate than the reduction of labor costs, it might be a sign that the labor force is losing ground in terms of jobs and/or job turnovers or in lowered salaries.  In fact, in 2013, in every quarter -- except for the second quarter -- labor costs fell to the extent that they are now contracting (below 0% growth).  This, then, has resulted in, what I think, is a very disturbing chart:

Of particular note is the yellow line.  This plot of "Unit Labor Costs" clearly shows that they have fallen to levels that haven't been seen since 2001 and 2008; when, in both those previous years, we were in the midst of a recession.  However, unlike those two years, we are hardly in a recession with economic growth in the last two quarters at 4.1% and 3.2%, respectively.
 
I think the drop in labor costs are proof that ObamaCare may be impacting the workforce in a substantial way by converting high-paying, full-time jobs to part time; thus lowering unit costs.  That's why the Huffington Post reported that 75% of jobs created this year were part time. It certainly is no coincidence that the drop unit costs occurred in the same year that ObamaCare was being implemented. At the same time, it may be the very reason as to why only 75,000 jobs were created in December and 113,000 in January.  In any event, we are now seeing recession-like unit labor costs and the reason isn't characteristically a recession.


References:

BLS, February 6 report, 4th Quarter Productivity and Costs: http://www.bls.gov/news.release/prod2.nr0.htm

Briefing.com: Statistical Summary of the 4th Quarter Productivity Report: http://www.briefing.com/Investor/Calendars/Economic/Releases/prod.htm

GDP: Economic Growth: http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

75% Of Jobs Created This Year Were Part-Time: http://www.huffingtonpost.com/2013/08/21/part-time-job-creation_n_3788365.html