Wednesday, August 7, 2013

Lest you think the economy is recovering: Part 3?....I don't even know anymore!

Two things to keep in mind in terms of employment figures during this "Obama recovery".  First, the unemployment rate has been steadily declining not because the economy is growing fast enough to create more jobs, but because hundreds of thousands of people have been unable to find a job in well over a year of looking and are, thus, no longer considered to be part of the labor market, employed or otherwise.  And since these people are not counted as unemployed any longer, they are not part of the current 7.4% unemployment rate.  And second, the vast majority of the jobs that have been created under Obama's reign are part-time jobs, not full-time.  And, as this excerpt from a recent Washington Time article points out, Obamacare will only make matters worse (HT: Hit & Run blog):
Since January 2009 the country has added a net total of 270,000 full-time jobs, but it has added 1.9 million part-time jobs, according to the House Ways and Means Committee.

The numbers come as Republicans argue that the president’s health care law is pushing businesses to save money and push workers into shorter schedules to avoid the penalties that come from hiring more full-time workers, who under the law will be required to be covered with health care insurance.
And more on the effects of Obamacare on employment in this piece at Hit & Run:
What appears to be happening, in other words, is a threshold effect. People hovering around the borderline—just above 30 hours—are seeing their hours capped. And new positions that might have offered 32 or 34 hours of work in the past are being created as 25-29 hour a week jobs.

Some additional anecdotal evidence that the law is making it harder for workers to get more hours on the job comes from Greg Mankiw's blog. Mankiw, the chairman of the Harvard economics department, posted a letter from a college instructor today reporting that part time faculty are seeing their hours capped in order to avoid the law's penalties for not offering insurance coverage.[Emphasis Marc Street]