By Tom Curry
The
non-partisan Congressional Budget Office gave new fuel to the debate
over the Affordable Care Act Tuesday with its estimate that the law will
lead to the eventual loss of about 2.5 million full-time jobs.
In
its annual budget and economic forecast the agency also said that the
ACA or Obamacare will reduce the total number of hours worked by about
1.5 percent to 2 percent from 2017 to 2024.
Even though total
employment will increase over the coming decade, the CBO said, “that
increase will be smaller than it would have been in the absence of the
ACA.”
CBO
director Douglas Elmendorf told reporters that the analysis done by his
agency’s experts “led us to conclude that the effect of the Affordable
Care Act on labor supply would be a good deal larger than we had thought
originally.” In 2011, the CBO estimated the loss of full-time
equivalent jobs due to the law would be about 800,000.
Elmendorf
also told reporters that the employer mandate – the requirement that
firms offer health insurance to workers– “will reduce the demand for
labor in the short term because employers face this extra cost. It is
analogous in some ways to raising the minimum wage.”
The
CBO report said that “workers will choose to supply less labor—given
the new taxes and other incentives they will face and the financial
benefits some will receive.”
Both
sides of the Obamacare debate used the new findings to buttress their
arguments, with House Speaker John Boehner saying that Republicans had
argued for years that “the president's health care law creates
uncertainty for small businesses, hurts take-home pay, and makes it
harder to invest in new workers. The middle class is getting squeezed in
this economy, and this CBO report confirms that Obamacare is making it
worse.”
But Obama spokesman Jay
Carney said the CBO analysis was incomplete. The budget office, he said,
did not take into account the beneficial effect of slower health care
cost growth due to the ACA, “Experts have estimated that slower growth
in health costs due to the ACA will cause the economy to add an
additional 250,000 to 400,000 jobs per year by the end of the decade,”
he said. “Moreover, CBO does not take into account positive impacts on
worker productivity due to the ACA's role in improving workers' health,
including reduced absenteeism.”
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