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Digging Deeper Into The April Jobs Report

- May 3, 2013

Labor Force Woes Persist

Since Obama Took Office, The Labor Force Participation Rate Has Declined From 65.7 Percent To 63.3 Percent. (Bureau Of Labor Statistics, Accessed 5/3/13)

  • In April, The Labor Force Participation Rate Remained At 63.3 Percent, The Lowest Rate Since 1979. (Bureau Of Labor Statistics, Accessed 5/3/13)

A Recent Study By The Boston Federal Reserve Concluded That The Decline In Labor Force Participation Is Mostly Due To Prime-Age Workers Dropping Out Of The Work Force, Rather Than Elderly Retirement.  “These regression results provide stark evidence that cyclical factors have been crucial in explaining the recent decline in prime-age LFPR. The coefficient on the lagged change in prime-age unemployment is highly significant (t-statistic of -3.9); that is, the state-level data exhibit a strong negative correlation between changes in LFPR and lagged changes in unemployment for prime-age adults. In contrast, the regression intercept is not statistically significant from zero (t-statistic of -0.97), indicating that the data provides no support whatsoever for structural interpretations of the drop in prime-age LFPR. In effect, the state-level data indicates that the aggregate decline in prime-age LFPR since 2007 can be fully explained by the persistent shortfall in labor demand…” (Christopher J. Erceg and Andrew T. Levin, “Labor Force Participation And Monetary Policy In The Wake Of The Great Recession,” Boston Federal Reserve, 4/9/13)

“What Is New, Surprising, Alarming And Often Overlooked In The Labor Force Today Is The Exodus Of Workers In Their Prime — And All The Growth Opportunities They’ve Taken With Them.” “This is exactly why it was wrong in the first place to point to demographic change as the more important component of the decline in labor force participation today. It has never been a question that America’s demographics would shift as the baby boomers began to retire; we’ve seen it coming for decades. What is new, surprising, alarming and often overlooked in the labor force today is the exodus of workers in their prime — and all the growth opportunities they’ve taken with them.” (Jim Tankersley, “WonkFeud Part 2: The Labor Force Participation Debate Gets Real,” The Washington Post’s WonkBlog, 4/30/13)

ObamaCare Is Creating A Class Of Long-Term Part-Time Employees

The Number Of Workers Working Part-Time For Economic Reasons Is 7.9 Million. (Bureau Of Labor Statistics, Accessed 5/3/13)

  • In April, The Number Of Workers Working Part-Time For Economic Reasons Increased By 278,000. (Bureau Of Labor Statistics, Accessed 5/3/13)

ObamaCare Is Forcing Employers To Cut Back Employee Hours, Which Is “Not Good For The Economy Or Health Care Access.” “But to win support for the law, Obama claimed it would lower costs, improve the quality of care and not force anyone off their current health care plan. That’s not shaping up to be the case. Premiums are rising, employer uncertainty is growing and voters aren’t viewing the law favorably – with many not even aware of the frontloaded benefits already in place. And even on the access side, the law of unintended consequences is kicking in: Some large retail companies are cutting back employee hours so they won’t have to offer health insurance. That’s not good for the economy or health care access.” (Josh Kraushaar, “Obama’s Legacy: A Health Care Law That Hurts His Party,” National Journal, 5/2/13)

Part-Time Workers “Are Facing A Double Whammy” From ObamaCare. “Many part-timers are facing a double whammy from President Obama's Affordable Care Act.” (Chad Terhune, “Part-Timers To Lose Pay Amid Health Act’s New Math,” Los Angeles Times, 5/2/13) 

With ObamaCare Part-Time Workers Will “Earn Less Money” And Miss Out On Employer-Sponsored Health Care. “The result: Not only will these workers earn less money, but they'll also miss out on health insurance at work.” (Chad Terhune, “Part-Timers To Lose Pay Amid Health Act’s New Math,” Los Angeles Times, 5/2/13) 

  • In Long Beach, CA, The City Is Cutting The Hours Of Part-Time Employees. “Consider the city of Long Beach. It is limiting most of its 1,600 part-time employees to fewer than 27 hours a week, on average. City officials say that without cutting payroll hours, new health benefits would cost up to $2 million more next year, and that extra expense would trigger layoffs and cutbacks in city services.” (Chad Terhune, “Part-Timers To Lose Pay Amid Health Act’s New Math,” Los Angeles Times, 5/2/13) 

Hundreds Of Thousands Of Part-Time Workers May See Lower Earnings Due To ObamaCare. “Across the nation, hundreds of thousands of other hourly workers may also see smaller paychecks in the coming year because of this response to the federal healthcare law.” (Chad Terhune, “Part-Timers To Lose Pay Amid Health Act’s New Math,” Los Angeles Times, 5/2/13) 


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