Financial Crisis - 2013 - ????

[Ryan Ruck]

Behold The Part-Time Worker Society: "We Won't Start Hiring Full-Time People"

July 15, 2013

Once again, as always happens with a very substantial delay, two themes that have been covered extensively on these pages in the past much to the ridicule of the mainstream media, namely that while the US may have "No Manufacturing Jobs But More Waiters And Bartenders Than Ever" and that Obamacare has finally struck as "Part-Time Jobs Surge To All Time High; Full-Time Jobs Plunge By 240,000" are now begrudgingly covered and in fact, endorsed, by the very same MSM.

Enter the Wall Street Journal which blends the two themes well known to our readers, and writes that "More Restaurants Replace Full-Timers, Concerned About Insurance."

To wit: "Ken Adams has been turning to more part-time workers at his 10 Subway sandwich shops in Michigan to avoid possibly incurring higher health-care costs under the new federal insurance law. He added approximately 25 part-time workers in May and June as he reduced some employees' hours and replaced other workers who left. The move showed how efforts by some restaurant owners and other businesses to remake their workforces because of the Affordable Care Act may be turning the country's labor market into a more part-time workforce." In other words, the already worst paying jobs in the US are getting even more of the shaft, downgraded from full time to part time status. Precisely the New "part-time worker society" that we predicted would happen back in 2010...




From the WSJ for those who are still unfamiliar:

Restaurants and bars have been adding an average of 50,000 jobs monthly since April—about double the rate from 2012. In June, they added a seasonally adjusted 51,700 jobs, up from May's 47,900 tally, but below April's 51,800. Overall, leisure-and-hospitality establishments hired more workers than any other industry in June, accounting for 75,000 of the 195,000 jobs added last month, according to the most recent Labor Department report, although economists cautioned against reading too much into one month's preliminary figures.

Views differ on exactly what is driving the hospitality industry's pickup. Other factors likely also were behind it, including the addition of new restaurants as well as a move to staff up hiring after scaling back during the downturn, according to some restaurant owners and industry experts. But a number of restaurants and other low-wage employers say they are increasing their staffs by hiring more part-time workers to reduce reliance on full-timers before the health-care law takes effect.

"I'd be surprised if the Affordable Care Act didn't have something to do with" the pickup in part-time hiring, said Paul Dales, senior U.S. economist at Capital Economics. "Companies don't want to pay for health care unnecessarily if they can avoid it, so they'll try to avoid it." However, he said "the effects will be harder to discern in the data."

For the entire U.S. workforce, employers have added far more part-time employees in 2013—averaging 93,000 a month, seasonally adjusted—than full-time workers, which have averaged 22,000. Last year the reverse was true, with employers adding 31,000 part-time workers monthly, compared with 171,000 full-time ones.

The Affordable Care Act requires employers with 50 or more full-time equivalent workers to offer affordable insurance to employees working 30 or more hours a week or face fines. Some companies have said the requirement could increase their costs significantly, although others have played down the potential hit.

The cost for small firms to comply with the health law will depend largely on the number of additional full-time employees that sign up for employer-sponsored coverage. Average annual premiums for employer-sponsored health insurance in 2012 were $5,615 for single coverage and $15,745 for family coverage, according to the Kaiser Family Foundation. That is up from $3,083 and $8,003, respectively, in 2002.

The administration says the law ultimately will help businesses by allowing them to pool risk with other smaller businesses in order to get more competitive rates. "The health-care law will decrease costs, strengthen small businesses and make it easier for employers to provide coverage to their workers, as we saw in Massachusetts, where employer coverage increased when similar reforms were adopted," said Joanne Peters, spokeswoman for the Department of Health and Human Services.

The cost for small firms to comply with the health law will depend largely on the number of additional full-time employees that sign up for employer-sponsored coverage. Average annual premiums for employer-sponsored health insurance in 2012 were $5,615 for single coverage and $15,745 for family coverage, according to the Kaiser Family Foundation. That is up from $3,083 and $8,003, respectively, in 2002.

Restaurant owners who have already begun shifting to part-time workers say they will continue that pattern.

"Does the delay change anything for us? Absolutely not," Mr. Adams of Subway said, explaining that whether his health-care costs go up next year or in 2015, he will have to comply with the law. "We won't start hiring full-time people."

More here but the message is clear: the part-time "recovery" comes full circle, or as we showed here previously:

[Ryan Ruck]

101M Get Food Aid from Federal Gov’t; Outnumber Full-Time Private Sector Workers

July 8, 2013

The number of Americans receiving subsidized food assistance from the federal government has risen to 101 million, representing roughly a third of the U.S. population.

The U.S. Department of Agriculture estimates that a total of 101,000,000 people currently participate in at least one of the 15 food programs offered by the agency, at a cost of $114 billion in fiscal year 2012.

That means the number of Americans receiving food assistance has surpassed the number of full-time private sector workers in the U.S.

According to the Bureau of Labor Statistics (BLS), there were 97,180,000 full-time private sector workers in 2012.

The population of the U.S. is 316.2 million people, meaning nearly a third of Americans receive food aid from the government.

Of the 101 million receiving food benefits, a record 47 million Americans participated in the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps. The USDA describes SNAP as the “largest program in the domestic hunger safety net.”

The USDA says the number of Americans on food stamps is a “historically high figure that has risen with the economic downturn.”

SNAP has a monthly average of 46.7 million participants, or 22.5 million households. Food stamps alone had a budget of $88.6 billion in FY 2012.

The USDA also offers nutrition assistance for pregnant women, school children and seniors.

The National School Lunch program provides 32 million students with low-cost or no-cost meals daily; 10.6 million participate in the School Breakfast Program; and 8.9 million receive benefits from the Woman, Infants and Children (WIC) program each month, the latter designed for low-income pregnant, breastfeeding, and postpartum women, as well as children younger than 5 years old.

In addition, 3.3 million children at day care centers receive snacks through the Child and Adult Care Food Program.

There’s also a Special Milk Program for schools and a Summer Food Service Program, through which 2.3 million children received aid in July 2011 during summer vacation.

At farmer’s markets, 864,000 seniors receive benefits to purchase food and 1.9 million women and children use coupons from the program.

A “potential for overlap” exists with the many food programs offered by the USDA, allowing participants to have more than their daily food needs subsidized completely by the federal government.

According to a July 3 audit by the Inspector General, the USDA’s Food Nutrition Service (FNS) “may be duplicating its efforts by providing participants total benefits in excess of 100 percent of daily nutritional needs when households and/or individuals participate in more than one FNS program simultaneously.”

Food assistance programs are designed to be a “safety net,” the IG said.

“With the growing rate of food insecurity among U.S. households and significant pressures on the Federal budget, it is important to understand how food assistance programs complement one another as a safety net, and how services from these 15 individual programs may be inefficient, due to overlap and duplication,” the audit said.