Human resource experts have been analyzing the effects that health care reform will have on the hiring process and many believe there will actually be less jobs available and less full-time positions being offered to employees. A controversial part of the Affordable Care Act requires companies with over 50 employees to offer a health insurance plan and this has a lot of employers scrambling to make up the cost of this requirement. To save money they could end up hiring less people or offering fewer full-time positions to avoid paying the high cost of health insurance.
If this happens, it could significantly dampen job growth in 2013 according to Paul Davidson’s article on USA Today. Job growth is already being threatened by the looming fiscal cliff and health care reform could slow it even further. Mark Zandi, the chief economist of Moody’s Analytics insists health care reform, possible federal budget cutbacks and spending cuts will end up having a negative impact on overall job growth.
Employers with more than 50 employees will be required to offer their full-time employees working at least 30 hours health insurance and this can add up to major dollars. If they do not offer health insurance they will be required to pay a $2000 fine for each employee after the first 30. This is even more expensive so employers are feeling that this requirement will severely affect their bottom line. It begs the question of whether or not this is a necessary aspect of health law and is it worth sacrificing job growth?
This employer-mandate doesn’t take effect until January of 2014, but employers are starting to evaluate how they will afford this new requirement. It could mean hiring less to make sure they have the funds available to pay the health insurance costs. They need to track their employees schedules for 3-12 months to ensure all employee costs are accounted for. About 1/4 of businesses surveyed by Mercer do not offer health insurance to employees and half of them will be making changes so that more of their employees work less than the required 30 hours. These means less money for workers and less job opportunities across the board.
This aspect of health law will especially impact smaller businesses approaching the 50 employee mark as they try to expand their company. The principal at Compass Workforce Solutions, a human resource consulting firm in Melville, NY, Christine Ippolito says may of these smaller businesses are actually holding back hiring to avoid reaching this 50-employee threshold. This is surely not the direction we want to be heading, but there is inherent value in health insurance being offered through employers. It’s a tough situation that has no easy answers at this time.
Written by Sam Tabes
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Tags: affordable care act, employer-sponsored health plans, health care reform, health insurance news, health law