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Evidence shows that the ACA is pushing a subset of U.S. workers into involuntary part-time jobs

The Affordable Care Act (ACA) requires firms with 50 or more full-time equivalent employees to offer health insurance to full-time employees, defined as those averaging more than 30 hours a week. Many observers worry that firms may avoid this mandate by using more low-hours part-time workers, but early evidence has been mixed. New research by Marcus Dillender, Carolyn Heinrich and Susan Houseman suggests employer efforts to avoid the health insurance mandate have forced up to a million U.S. workers into part-time jobs when they wanted full-time work.

In previous work, Dillender, Heinrich and Houseman estimated that when the ACA was passed, about five percent of wage and salary workers could be vulnerable to such changes in their terms of employment. In a new working paper, they use Current Population Survey data to analyze changes in low-hours part-time employment since the passage of the ACA. Their study’s methodology uses Hawaii as a comparison group; Hawaii has had a much tougher employer health insurance mandate for decades, and so the ACA mandate should not affect Hawaiian employers’ decisions to use part-time workers.

Although the authors find no effect of the ACA mandate on part-time employment in most industries, they estimate that the mandate increased low-hours, involuntary part-time employment by two to three percentage points in retail, accommodations and food services.  That translates to between 500,000 and one million workers stuck with fewer hours than they want to work. Variable weekly scheduling and low-hours, part-time work were already prevalent, and consequently reducing some workers’ hours to side-step the mandate may be more attractive, in these industries.

Read Effects of the Affordable Care Act on Part-Time Employment: Early Evidence, by Marcus Dillender, Carolyn Heinrich, and Susan Houseman

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            Contact: Justin Carinci