A new report finds that during the first full year of its coverage expansions, the Affordable Care Act (ACA) had no negative impact on employment and number of hours worked. If anything, implementation of the ACA was associated with an increase in employment among those most likely to be affected by its provisions. Specifically, researchers from the Urban Institute, with funding from the Robert Wood Johnson Foundation, examined whether the ACA and its Medicaid expansions affected four key measures of work effort: labor force participation; employment; the probability of part-time work; and hours worked per week by nonelderly adults in the U.S. Data for the analysis came from the Current Population Survey used by the federal government to monitor the labor market.
Overall the report finds no evidence that trends in the four measures of work effort deviated in 2014 in response to the ACA. For persons with a high school education or less who are more likely to be affected, however, the ACA was associated with a small increase in employment and the probability of part-time work. The former finding is surprising, as most observers predicted the ACA would decrease employment.
In addition, the researchers examined whether the Medicaid expansions of the ACA had any impact on work effort, again focusing on persons with a high school education or less who are most likely to be affected by Medicaid expansions. In this case too, the report finds no evidence of any adverse effects on work effort, as the change in employment and other measures of work did not differ between states that did and did not expand Medicaid as part of the ACA.
“The ACA has been castigated as a ‘job-killing’ policy since day one, but once again we see that these charges are not supported by the evidence,” said Kathy Hempstead, who directs coverage issues at the Robert Wood Johnson Foundation. “In terms of both labor force participation and hours worked, employment trends reflect the pace of economic recovery.”
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