Blog PostMarch 4, 2014

All New Low-Wage Jobs In 2013 Had Sub-30-Hour Weeks

Government data shows low wage jobs fell below ACA 30 hour "full time" threshold

Author: Jed Graham

Publication: Investors Business Daily


All of the very low-wage jobs added in 2013 fell below the 30-hour threshold that ObamaCare defines as full-time, an analysis of government wage and hours-worked data suggests.

The finding highlights concerns about the impact of the health law’s employer insurance mandate, the proposed minimum wage hike and — especially — the combination of both.

The ranks of $7.25-to-$10 hourly wage earners usually working 25- to 29-hour weeks in their primary job surged 17%, or 224,000, from the fourth quarter of 2012 to 2013.

Meanwhile, those very low-wage earners typically clocking 31- to 34-hour weeks in their main job fell 11%, or 84,000. Within this wage range, 35 hours-plus workers declined 7%, or 725,000.

The data, derived from the Current Population Survey that yields the unemployment rate, offer an important clue for gauging the impact of the mandate to offer insurance to full-time workers.

Though the White House delayed the mandate in July and watered it down last month, penalties will apply in 2015 based on staffing levels measured in 2014. 

Economists from Washington to Wall Street, pointing to solid gains in full-time work and a roughly stable part-time workforce, see a negligible impact from the mandate.

That’s the view from 30,000 feet up. Yet such summary measures of the entire labor force obscure a less-sanguine reality for the low-wage earners.

The average workweek has fully recovered for mid-to-high earners, who are now working longer than before the recession. Meanwhile, for 30 million workers in low-wage private industries clocked the shortest average workweek on record at the end of last year — just 27.4 hours. 

It’s clear that something is seriously depressing the workweek for low-wage earners, but is that something ObamaCare?

One sign of at least a partial connection: The workweek has shrunk in many of the same industries where anecdotes have piled up about employers cutting hours to evade the law’s fines.

In 2013, average weekly hours fell 1% at supermarkets, 2% at clothing stores, 2.4% at limited-service restaurants, 3.2% among providers of home care services to the elderly and disabled, 4.2% at general merchandise stores, 7.2% at retail bakeries and 7.7% at home-center retailers.

CPS data suggesting that ObamaCare’s 30-hour full-time threshold was a significant dividing line in 2013 between job gains and no job gains among very low-wage earners now provide further evidence of a connection.

This finding runs counter to research from the White House and the liberal Center for Economic Policy Research. Both have cited detailed CPS data on hours worked to debunk claims that ObamaCare is causing a shift to part-time work.