Tags: health | insurance | job | employment

Obamacare, Not Cold Weather, Caused December Hiring Freeze

By    |   Wednesday, 15 Jan 2014 06:50 AM

Cold weather was blamed for lower-than-expected job creation in December. Analysts seem to believe that when the temperature drops, few employers are willing to hire and few job applicants are willing to venture outdoors in pursuit of work.

Data show that one of those assumptions is flawed — job seekers are not afraid of the cold.

The Bureau of Labor Statistics (BLS) generates the monthly employment report based on data from a one-week period every month. In December, it was the week of Dec. 9.

New claims for unemployment compensation reached an eight-month high that week. Even though it was too cold to look for work, it wasn't too cold to apply for benefit checks. Claims for unemployment actually spiked higher the week before the BLS survey. This indicates that businesses were cutting back even before the weather turned cold.

If it wasn't the cold that held down the number of jobs created, it must have been the economy or some other factor.

December was when many employers were facing higher health insurance premiums for policies that renewed in January. Layoffs to reduce costs are consistent with the data showing an increase in layoffs when premium payments were due in mid-December. It is also logical to see a decrease in hiring while business owners worked to meet higher expenses for health insurance.

Businesses cannot meet higher costs unless sales increase or expenses decrease. With consumers also struggling to pay higher insurance premiums, sales are unlikely to increase. Cutting expenses, and employment, are the natural result of higher costs associated with health insurance.

As consumers and businesses struggle with the unintended consequences of the Affordable Care Act, a recession is likely to begin in the next few months.

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MichaelCarr
Cold weather was blamed for lower-than-expected job creation in December. Analysts seem to believe that when the temperature drops, few employers are willing to hire and few job applicants are willing to venture outdoors in pursuit of work.
health,insurance,job,employment
286
2014-50-15
Wednesday, 15 Jan 2014 06:50 AM
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