CBO: Health law to shrink workforce by 800K
Friday, February 11, 2011
CBO - Health law to shrink workforce by 800,000
By: J. Lester Feder and Kate Nocera, POLITICO
CBO Director Douglas Elmendorf told the House Budget Committee
on Thursday that the health care law will reduce employment by 0.5
percent by 2021 because some people will no longer have to work
just to afford health insurance.
"That means that if the reduction in the labor used was workers
working the average number of hours in the economy and earning the
average wage, that there would be a reduction of 800,000 workers,"
Elmendorf said in an exchange with Rep. John Campbell (R-CA).
The report, published in August, said, "The Congressional Budget
Office estimates that the legislation, on net, will reduce the
amount of labor used in the economy by a small amount-roughly half
a percent-primarily by reducing the amount of labor that workers
choose to supply … That net effect reflects changes in incentives
in the labor market that operate in both directions: Some
provisions of the legislation will discourage people from working
more hours or entering the workforce, and other provisions will
encourage them to work more."
Republicans gleefully seized on the admission, eagerly promoting it
as evidence of what they call the law's job-killing effect.
"More bad news for American families," was how Budget Committee
Chairman Paul Ryan's office described the report in a
release.
"Since day one Republicans have opposed Obamacare for a simple
reason: it would destroy jobs. Minority Leader Pelosi, Leader Reid
and others said we were wrong. Guess not," said John Murray, deputy
chief of staff for Majority Leader Eric Cantor.