President Obama and the Democrats have expended so much time and energy on rushing and pushing through a landmark legislation to provide health care coverage for all Americans, they failed to take into account that it would generate an unintended consequence for many young Americans about to enter workforce: more unemployment.
This article from RealClearMarkets.com by Diana Furchtgott-Roth stated that employers are far less likely to hire young or low-skilled/unskilled workers in the future once the lawful effects of Obamacare kick in 2014:
But, come 2014, the new health care bill will make it harder for employers to hire low-skill workers. And, as workplaces around the country prepare to implement the Patient Protection and Affordable Care Act, employers are considering how best to comply. For some companies, that means that low-wage and part-time jobs will start to go, not in 2014, but now.
Industries that have traditionally offered the most opportunities to low-skill workers – leisure and hospitality, and the retail trade – will be particularly hard-hit by the new law. Many employers do not provide their employees with health insurance, and both sectors have large percentages of part-time workers, whose cost of hiring will increase significantly.
If it is all indicated, a great number of young people, unskilled and/or low-skilled people, which included people in their mid-40s to 60s, and people with disabilities (those who can still function in some parts job-wise), are going to be the hardest hits.
I don’t know how much impact Obamacare is going to be on many large and mid-sized employers once after it starts kicking in 2014, but these employers have already prepared its long-term plannings on future hiring, the re-adjustment of its current workforce, its operations, production facilities, and/or franchises, to set up criteria for manageable and productive results to satisfy customer or client bases, and to ensure long-term profitability. I believe that Obamacare is going to make part-time jobs a thing of the past as employers are not going to pay health care benefits for part-timers the equivalent of full-time workers.
Unless Obamacare is either revised immensely or repealed outright, many young and older people are going to be greatly affected. Young people who work in restaurants, warehouses, and retail stores as part-time while going to schools or colleges. Older people (mid-40s to late 60s) who work in retail stores, restaurants or warehouses as part-time. People with certain disabilities, but can still function in some parts, may not be hired in either part-time or full-time because of persistent perception of higher medical costs involved for a person with a disability (though not always in most cases).
This would put difficult binds on these people, for their financial and lifestyle choices would be altered or sacrificed just to live.
Consider this:
In 2009, 50% of restaurant employees and 36% of retail employees worked part-time, i.e. under 35 hours per week. A higher percentage of women, 58% in the restaurant industry and 44% in the retail industry, work part-time.
With higher-skill jobs, employers can offer the required benefits and pay for them by cutting the wage. But low-wage jobs in the restaurant and retail sectors leave little room for cuts in wages.
So firms will have an incentive to become more automated, or machinery-intensive – and hire fewer workers. Fast food restaurants could ship in more food and have it reheated, rather than cooking it on the premises. Department stores could have fewer sales clerks and more price-scanning stations, so that shoppers could scan labels for prices rather than asking sales assistants.
If you look for a cloud having a silver lining, you shouldn’t ignore that dark and ominous clouds around it.
Certain people wanted to be useful to others in their jobs, they wanted to be productive and find the time to do something with their lives instead of doing nothing or being bored. I find this to be true when I was working with other people over the years, though I encountered people who didn’t like their jobs or find it boring and uninspiring; in some cases – they don’t like to work with fellow employees or for some asshole bosses. Oh, the drama. But all of them have something in common: they wanted to earn money by applying their skills for the employers and get benefits anyway.
On this point, as employers plan to re-adjust or re-make its entire work infrastructure just to stay profitable and in business, in preparation for the full effects of Obamacare, the future does not look quite bright for many young and older people trying to make ends meet. Low-skilled or unskilled people needed to enter employment so they can build up their skills and become more marketable to other employers for full-time jobs in the future.
While President Obama and the Democratic majority in Congress were more interesting in getting a very partisan legislation passed and signed into law, they didn’t give a damn about the loss of American jobs or doing whatever it takes to get Americans back to being employed for long-term gains, they also forced employers into a difficult position of not hiring low-skilled or unskilled people in the future.
Paul Mirengoff of Power Line (whose blog on the same subject got me on it today) is right to point this out:
In some ways, generic claims that President Obama should have focused more on getting Americans back to work and less on transformative legislation like health care reform are too facile. A president need not devote large amounts of time to figuring out how to improve the short-term jobs outlook because there is little a president reasonably can do to put Americans back to work in the short-term.
But a president who pushes through legislation, the natural effect of which is to discourage hiring, deserves criticism when the job market lags (and even when it doesn’t). Obama has now put himself in that category.
Come 2012, Obama is going to be consistently reminded of this enough, he is bounded to lose the presidential election anyway.
