This is already happening at my husband’s company. Â They are no longer permitted to hire full-time workers for non-salaried positions.
The threat of fines totaling $2,000 a year for not providing health care to full-time workers will be a great subsidy for companies that supply part-time workers. They will be in greater demand.
Workers who already work less than 30 hours a week will find lots of new competition. They are likely to be locked into their positions permanently.
Any firm with 50 employees comes under the law. So, the smart move for businesses with 50 to 60 workers is to fire them.
Economics teaches that decisions are made at the margin. What does one more unit of this or that cost? That is the key price for all of the units.
Businesses can take two approaches. First, they can cut workers who work 30 hours a week to 29 hours. Or, just to be safe, 25 hours. Second, they can fire workers who work 30 hours a week and refuse to hire replacements. Both approaches are legal. Both make economic sense.
We are in a tight job market. We have been ever since 2008. The recovery is slow. This will make it slower.