Ace Bandage

The Affordable Care Act, also known as Obamacare, is not leading to more part-time work, say two recent analyses.

(Plain Dealer file)

CLEVELAND, Ohio -- Obamacare has not led to more people working part-time from employers reducing workers' hours to avoid penalties for failing to provide healthcare coverage, say recent analyses by two national think tanks.

For more than a year, a widely held theory was that many employers had already begun limiting part-timers to under 30 hours a week to avoid penalties under the Affordable Care Act -- penalties that were at least a year off from being implemented. The analyses say Labor Department and Census Bureau employment data, so far, don't support such assumptions.

An analysis released earlier this month by the Washington, D.C.-based Urban Institute and the Robert Wood Johnson Foundation in Princeton, New Jersey, found that any increase in part-time work was more attributable to a slow recovery than to the ACA.

"There was a marked increase in part-time work during the Great Recession (which officially ran from December 2007 to June 2009)," the report stated. "The return to pre-recession levels of part-time work has been slow and incomplete as of 2014."

An analysis by the Washington, D.C.-based Center for Economic and Policy Research, released last week, said some workers were choosing -- not being forced into -- part-time work because of the ACA. The authors said workers could now take part-time jobs because they didn't need to work full-time to become eligible for medical benefits under the ACA.

"(B)y allowing people to buy insurance through the exchanges and extending Medicaid coverage to millions of people, the ACA also largely ends workers' dependence on their employer for insurance," stated the Center for Economic and Policy Research report. "This gives tens of millions of people the option to change their job, to work part-time, or take time off to be with young children or family members in need of care, or to retire early."

Central to the issue of part-time work for both analyses was whether people were choosing to opt out of full-time work since the ACA went into effect in January. Government statistics show whether people are working part-time because they choose to or are involuntarily working part-time. Most involuntary part-time workers want full-time employment, but can't find it.

Both critics and supporters have seen a direct link between the ACA and part-time work. In general, critics said it would lead to employers cutting workers to below 30 hours a week rather than provide them with the health coverage outlined in the law. Such penalties have been delayed until 2015 for employers with at least 100 workers. Employers with between 50 and 99 workers won't face penalties until 2016.

In general, supporters of ACA point to the life-balance option now offered to those who were only working full-time to receive adequate medical coverage. Under the ACA, workers with annual incomes under 400 percent of the federal poverty level are eligible to buy coverage through a health exchange, where subsidies to defray costs are offered. For example, 400 percent of poverty is $95,400 for a family of four.

The CEPR analysis focused on those who wanted to work part-time. The analysis was done by Helene Jorgensen, a senior research associate at the center and Dean Baker, an economist and CEPR's co-director. The analysis by the Urban Institute and Robert Wood Johnson Foundation focused on involuntary part-time workers. That analysis was done by Bowen Garrett, a senior fellow at the Urban Institute's Health Policy Center, and Robert Kaestner, an economics professor at the University of Illinois at Chicago.

Garrett and Kaestner looked closely at trends in two areas of part-time work where the ACA could potentially trigger an impact. The first was the rate of part-timers working between 30 and 34 hours. For example, fewer employees in this category could suggest employers were reducing workers' hours in an attempt to avoid future penalties. The second area they examined looked at transition rates between workers moving from full-time to part-time employment. For example, people transitioning from full-time to involuntary part-time work could suggest that employers were opting for a workforce of more part-time workers to avoid paying medical benefits.

The authors found very little change in transition rates between full-time and part-time work since the ACA began. Rates were similar to the long-term average covering the period between 2000 and 2012.

However, Garrett and Kaestner found a "small, statistically significant" increase in part-time work in 2014, beyond what would have been expected this deep into a recovery. Also, they reasoned that the declining unemployment rate would have led to fewer part-time workers. They said a sluggish recovery had caused part-time work to persist, as well as the trend toward an increasing amount of part-time work, which had started taking shape even before the recession began.

The authors found those involuntarily working part-time accounted for most of the increase in part-time workers. Involuntary part-time work since ACA had increased for employees working at least 30 hours, as well as those working even fewer hours.

"However, similar growth in involuntary part-time work at and above the ACA threshold of 30 hours per week, and evidence of transitions between full-time and part-time work that are in line with historic patterns, suggest the increase in involuntary part-time work is most likely due to the severity and depth of the Great Recession -- not the ACA," they wrote.

"Although we find little evidence consistent with anticipatory effects of the ACA's employer mandate on part-time work to date, our analysis does not rule out the possibility of effects in the future if the mandate goes into effect in 2015 as scheduled, and as other ACA provisions are more fully implemented," Garrett and Kaestner wrote.

In their analysis, the CEPR's Jorgensen and Baker referred to the ACA as "a family-friendly policy." They analyzed patterns among voluntary part-time employees -- those working 35 hours or less -- and found that the biggest increase in the first seven months of 2014 had been among workers age 16 to 35. Employees in this group saw voluntary part-time work rise by 5 percent.

The CEPR analysis showed that younger workers opting for part-time work is a trend that began forming last summer as an understanding of the ACA was growing. Voluntary part-time employment among younger workers showed an even larger increase between July 2013 and July 2014 than it had during the first seven months of this year.

"The biggest increase in voluntary part-time is for young people with children," the report stated. "The percentage of employed young people with children working part-time increased 11.3 percent from 2013 to 2014. For young people with three or more children the percentage working part-time increased by 15.4 percent."

But like the other report's authors, Jorgensen and Baker cautioned they were offering an early analysis.

"It is certainly too early to make any definitive judgments about the effects of the ACA on the labor market, however, these data suggest that it is freeing workers of the dependence on their jobs for their health care," the CEPR report stated.