travelover
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Oh, they wouldn't do that...........unless they could get away with it.
Hey! Get off my lawn
- Thread starter zedd
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Oh, they wouldn't do that...........unless they could get away with it.
Tadpole
Thinks s/he gets paid by the post
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Apparently, a few people don't read the ER forums. CBO didn't need to update a study for the critters to learn about this phenomenon. You guys have been discussing the RE enabling features of ACA for a long, long time. (As well as the possible gaming of income for maximum ACA subsidies.) Think there will be any consequences because of these features reaching the light of day?
So recessions and depressions aren't really a problem?
Having a large portion of the population desperate to find work and unable find it is nothing to worry about?
By that logic, the affects of the ACA really don't matter, because even if it destroys jobs, there was no "right" number of jobs anyway.
Having a large portion of the population desperate to find work and unable find it is nothing to worry about?
By that logic, the affects of the ACA really don't matter, because even if it destroys jobs, there was no "right" number of jobs anyway.
Strawman. That's not what I wrote, obviously.
Labor force participation is dropping--which is exactly opposite of what we'd expect if "the population were desperate to find work." Some people may have "given up" (i.e. they have found more attractive alternatives than hunting for/finding a job--at least a job in the "official economy").
There are many intertwined incentives at play here. There's no "lump of labor" and no static number of jobs. The number of jobs depends on the business climate and on the price of labor.
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I guess the 'jobs report' will be showing up soon? I made a prediction back in September 2013:
I can say for sure that this was central to my recent departure from the workforce.
Absolutely! The number of jobs is NOT static, but can rise or fall with overall health of nation's economy. Multiple examples of this within the Eurozone.
Another factor in US now seems to be workforce maldistribution. Very interesting front page article in WSJ today about more "prime working age" men not having jobs. I was struck by the multiple stories of unemployed folks apparently unwilling to relocate for a job, or even quitting a job to relocate to a more economically depressed area (e.g. quitting FT pos in FL to job seek in metro Detroit?).
More Men in Prime Working Ages Don't Have Jobs - WSJ.com
(unfortunately-pay article, but avail via many local libraries)
This is in face of latest Fed Beige Book report noting significantly improving labor demands (& housing markets) in multiple regions.
FRB: Beige Book - January 15, 2014
And here's a sample article from Midwest about specific skilled labor shortage (welders) inhibiting economic growth-
THE REGULARS: Workforce shortage requires both short-, long-term responses
Wouldn't the economy (& many families) be doing better if the skilled/educated unemployed & the available jobs got together
Here's a summary of the available data concerning labor force participation and healthcare availability via Medicaid. One study didn't show any affect, one showed an effect and the third estimated a pretty broad range for an effect ranging from almost nothing, to a fairly marked amount. Everyone may choose to ignore the study that doesn't support their own beliefs....
Yes, Obamacare will probably downsize the workforce. Economists explain why.
Yes, Obamacare will probably downsize the workforce. Economists explain why.
Interesting article, but shows these "expert" opinions covers all possibilities (up, down, or no effect). Reminds me of an old joke-
There are only 2 kinds of economists-
those who cannot forecast future employment,
and those who do not know they cannot forecast future employment
Safe to say only time will tell how ACA's effect on employment eventually plays out over next few years.
M Paquette
Moderator Emeritus
Here is the actual report:
http://www.cbo.gov/sites/default/files/cbofiles/attachments/45010-Outlook2014.pdf
Appendix C, "Labor Market Effects of the Affordable Care Act: Updated Estimates" is the specific relevant item.
Got that? The workers will choose to supply less labor.
If this bothers you, try to come up with a better alternative. Note that workers may raise objections to mandates requiring forced labor.
I am retired specifically because I was able to obtain and keep medical insurance coverage without having to rely on an employer's 'guaranteed issue' insurance pool.
http://www.cbo.gov/sites/default/files/cbofiles/attachments/45010-Outlook2014.pdf
Appendix C, "Labor Market Effects of the Affordable Care Act: Updated Estimates" is the specific relevant item.
Got that? The workers will choose to supply less labor.
If this bothers you, try to come up with a better alternative. Note that workers may raise objections to mandates requiring forced labor.
I am retired specifically because I was able to obtain and keep medical insurance coverage without having to rely on an employer's 'guaranteed issue' insurance pool.
Current CBO report enumerates many, many qualifiers & study limitations, and at times even seems somewhat self-contradictory in this area. However CBO may eventually prove correct in BOTH of it's main speculations on ACA's effect on overall employment. It is not inconsistent that w@rkers (generally) may well choose to w@rk less, and fewer jobs may exist with ACA than without it. For example, instead of aggressively expanding small business owners (themselves part of workforce & source of ~2/3rds of all new net private job creation) may choose to maintain or slightly contract at a time its workers may choose to work less. This is not necessarily negative so long as overall national productivity (inc tax revenues) can be maintained and labor supply/demand remains in rough balance.
F4mandolin
Full time employment: Posting here.
Anybody find it strange that almost everybody on this site admits to not knowing what the markets are going to do because it is so complicated.....but on the ACA topic there are a lot of people who seem to know what is going to happen? Seems pretty complicated to me and I am going to sit back and wait until the dust settles....I know I'm not smart enough to figure it all out.
M Paquette
Moderator Emeritus
Even worse, the workers, now free of 'job lock', may go off and become independent competition!
"Job lock", some may recall, was the locking of labor into a job just so that they could get insurance. One Rep. Paul Ryan (R) Wisconsin argued passionately back in May 20, 2009 that "The key question that ought to be addressed in any health care reform legislation is 'Are we going to continue job lock, or are we going to allow individuals more choice and portability to fit the twenty-first century workforce?'". He makes a good point. How many potential enterpreneurs were lost to job lock?
I gather some folks are now arguing that ending job lock is a bad thing.
One Rep. Paul Ryan (R) Wisconsin argued passionately today concerning the CBO report that "because of government policies as the welfare state expands, the incentive to work declines". Well, work for The Man, anyway. See, it turns out that 'incentive to work' is a codeword for 'incentive to work for the mid to large corporations that offer group medical insurance.
On the other hand, that worker could leave his job, knowing that he still has health insurance for himself and his family, and take a chance at starting his own business. The one thing that kept me from doing a couple of startups when I was in my 40s was the lack of decent medical coverage for my family.
The ACA is an incentive to not work in much the same way as Social Security is an incentive for workers to not die at their job. (Credit to John Stewart for that one.)
"Job lock", some may recall, was the locking of labor into a job just so that they could get insurance. One Rep. Paul Ryan (R) Wisconsin argued passionately back in May 20, 2009 that "The key question that ought to be addressed in any health care reform legislation is 'Are we going to continue job lock, or are we going to allow individuals more choice and portability to fit the twenty-first century workforce?'". He makes a good point. How many potential enterpreneurs were lost to job lock?
I gather some folks are now arguing that ending job lock is a bad thing.
One Rep. Paul Ryan (R) Wisconsin argued passionately today concerning the CBO report that "because of government policies as the welfare state expands, the incentive to work declines". Well, work for The Man, anyway. See, it turns out that 'incentive to work' is a codeword for 'incentive to work for the mid to large corporations that offer group medical insurance.
On the other hand, that worker could leave his job, knowing that he still has health insurance for himself and his family, and take a chance at starting his own business. The one thing that kept me from doing a couple of startups when I was in my 40s was the lack of decent medical coverage for my family.
The ACA is an incentive to not work in much the same way as Social Security is an incentive for workers to not die at their job. (Credit to John Stewart for that one.)
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If we look at the loss of the subsidy as the taxpayer exceeds 400% of the FPL, then the ACA definitely provides a disincentive to work for some people. We've talked about it on this board frequently. If we instead decide that Ryan is referring to some sort of benefit from job lock (despite what he said before), then I guess we can reach a different conclusion.
A more appropriate comparison between the ACA and SS: The loss of the ACA subsidies provides a disincentive to work just as the 50% tax on earned income for those who have taken SS early provides a disincentive to work. Maybe John Stewart can use that.
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The labor force participation rate dropped sharply because it is much harder to find a job than it was before the financial crisis, not because workers suddenly found "more attractive alternatives" to work.
For many people, the option to work was involuntarily removed as companies shed millions of workers in mass layoffs. The job market is somewhat better than it was during the financial crisis, but it is still pretty bad. There are still millions of people who got laid off during the crisis that would like to work, but are unable to find jobs.
For many people, the option to work was involuntarily removed as companies shed millions of workers in mass layoffs. The job market is somewhat better than it was during the financial crisis, but it is still pretty bad. There are still millions of people who got laid off during the crisis that would like to work, but are unable to find jobs.
Strawman. That's not what I wrote, obviously.
Labor force participation is dropping--which is exactly opposite of what we'd expect if "the population were desperate to find work." Some people may have "given up" (i.e. they have found more attractive alternatives than hunting for/finding a job--at least a job in the "official economy").
There are many intertwined incentives at play here. There's no "lump of labor" and no static number of jobs. The number of jobs depends on the business climate and on the price of labor.
Yes, these are factors in any labor market, but they are not the primary issue we currently face in our own labor market. The job market didn't get sharply worse in 2009 because people were suddenly more maldistributed.
The job market got worse in 2009 because of a sharp drop in overall labor demand. That demand has still not recovered to levels consistent with a healthy labor market. It continues to be much harder to find a job than it was before the recession.
The job market got worse in 2009 because of a sharp drop in overall labor demand. That demand has still not recovered to levels consistent with a healthy labor market. It continues to be much harder to find a job than it was before the recession.
Absolutely! The number of jobs is NOT static, but can rise or fall with overall health of nation's economy. Multiple examples of this within the Eurozone.
Another factor in US now seems to be workforce maldistribution. Very interesting front page article in WSJ today about more "prime working age" men not having jobs. I was struck by the multiple stories of unemployed folks apparently unwilling to relocate for a job, or even quitting a job to relocate to a more economically depressed area (e.g. quitting FT pos in FL to job seek in metro Detroit?).
More Men in Prime Working Ages Don't Have Jobs - WSJ.com
(unfortunately-pay article, but avail via many local libraries)
This is in face of latest Fed Beige Book report noting significantly improving labor demands (& housing markets) in multiple regions.
FRB: Beige Book - January 15, 2014
And here's a sample article from Midwest about specific skilled labor shortage (welders) inhibiting economic growth-
THE REGULARS: Workforce shortage requires both short-, long-term responses
Wouldn't the economy (& many families) be doing better if the skilled/educated unemployed & the available jobs got together
Here is a pretty good report from the CBO that discusses the reasons for the slow recovery of the labor market--
http://www.cbo.gov/sites/default/files/cbofiles/attachments/45011-LaborMarketReview.pdf
http://www.cbo.gov/sites/default/files/cbofiles/attachments/45011-LaborMarketReview.pdf
travelover
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Good point.It's not either/or, it's both. There's less work (whether we measure it as full-time jobs or raw hours) being done today than in 2009. But, there are also many more people who have dropped out of the official labor force and are no longer being counted as unemployed (even by the BLS's U-5 or U-6 standards, which is not what we normally see quoted).
Charts from the BLS. See slide 19. Note that the "Discouraged" and "Marginally Attached" numbers shot up after 2009 and remain high. These are people who have looked for work within the last 12 months, but not within the last 4 weeks. Now, I suppose this is subjective, but if a person is unemployed/underemployed and hasn't looked for a job/better job in the last 4 weeks, I think it's hard to make the case that they are "desperate for work." And the chart doesn't even count people who haven't looked for a job in 12 months--they just drop out of the denominator and, if no new workers entered the labor force the unemployment rate would eventually go very low.
Summary: Labor force participation is decreasing because there are fewer people working and because there are fewer people who want to work. By the numbers.
And this is why numbers don't tell the entire story.
Agreed. The CBO report I posted does a really good job of breaking all of it out.
I think my point that there is still more demand for jobs than there is supply still stands. The labor market is still pretty bad overall. We still have millions of people that would prefer to be working if the economy was doing well enough to generate more jobs.
As long as that is the case, the affects of the ACA facilitating voluntary retirements in the workforce are unlikely to have a large negative effect on GDP, unless the people doing the retiring have skillsets that can't be met by the people still looking for work.
I think my point that there is still more demand for jobs than there is supply still stands. The labor market is still pretty bad overall. We still have millions of people that would prefer to be working if the economy was doing well enough to generate more jobs.
As long as that is the case, the affects of the ACA facilitating voluntary retirements in the workforce are unlikely to have a large negative effect on GDP, unless the people doing the retiring have skillsets that can't be met by the people still looking for work.
M Paquette
Moderator Emeritus
E-Z fix time!
Just change the law slightly so that people must be employed for one continuous year before being able to claim Social Security. No more worries about people using the ACA to retire early, no problems with the 'reduced productivity' boogieman, and best of all, employers won't have to worry about improving incentives to get people to work for them.
Continued access to relatively cheap labor, improved productivity, and an incentive to participate in the work force! Sounds like a win all around, except maybe for a few members of the 'moocher/looter' class.
Sitting around the virtual coffee shop and fixing all the world's problems in 5 minutes since 2008... ;-)
Just change the law slightly so that people must be employed for one continuous year before being able to claim Social Security. No more worries about people using the ACA to retire early, no problems with the 'reduced productivity' boogieman, and best of all, employers won't have to worry about improving incentives to get people to work for them.
Continued access to relatively cheap labor, improved productivity, and an incentive to participate in the work force! Sounds like a win all around, except maybe for a few members of the 'moocher/looter' class.
Sitting around the virtual coffee shop and fixing all the world's problems in 5 minutes since 2008... ;-)
Hey, it's a good start. See if we can link in other programs (food stamps, EITC, elimination of the standard deduction for non-workers, etc). Include sudden and somewhat arbitrary hard cutoff points (income, wait times) and I think it will be something that might be obtuse enough to live forever.
Partially agree. Although shall-issue HI has been available to prospective IC's for some time in many states & through many professional societies, for others ACA should make it easier to leave megacorp & start their new business. However this positive for economic growth may be at least partially offset by ACA "cliffs" which create some very real incentives for that IC to limit their business. A sole proprietor supporting his/her family of 4 is going to think long and hard about taking on that next small/mid-sized contract in Nov or Dec that puts the yr's income beyond the 'magic' $94+k or 400% FPL (with loss of $thousands in HI subsidy). And I personally know more than 1 business owner with 40-45+ employees who has cancelled plans to expand specifically because those next few hires (to 50+) would subject the business to employee HI mandate & destroy their already slim profit margin.
Not trying to discourage anyone from becoming an IC, but ACA has added a few twists (pos & neg) to the decision.
Yes, I think it would make a lot of sense to smooth out those cliffs to make the incentives less perverse. I also think that if the exchanges work more or less as designed, it might make sense to consider dropping the employer mandate entirely so that we can inch towards getting employers out of the health insurance business at some point in the future.
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