Economy

Study: Obamacare is Not a Job Killer

CBS News: “Before the Affordable Care Act went into effect last year, critics claimed it would lead to job losses and cuts in employee hours. But how is it really playing out?”

“The dire predictions have so far proved to be unfounded, according to a new research paper from Federal Reserve Bank of New York economist Maxim Pinkovskiy. The fear was that employers who were newly required to provide health insurance to their workers would opt instead to cut hours or fire employees. But early numbers show that locations with a high percentage of uninsured Americans, such as Texas, ended up experiencing a rise in employment, salaries and output in comparison to areas with less exposure to the health care law, Pinkovskiy noted.”

“The bottom line is that in the first year of implementation, ‘it is unlikely the ACA had adverse labor market impacts,” he wrote. “It did not substantially impede the recovery after the Great Recession.'”

Midwest Leads in Financial Well-Being; South Lags

Gallup: “Hawaii residents had the highest financial well-being in the nation in 2014, followed closely by Alaska residents. Mississippi residents had the lowest financial well-being, with Tennessee not far behind.”

Mapgraph-FinancialWellbeing2014-state

“Midwestern states earned six of the 10 highest financial well-being scores, while Southern states accounted for all of the 10 lowest financial well-being scores. Differences in income, employment and age — all of which are linked to financial well-being — could help explain the regional pattern.”

“While they avoided being among the bottom 10 states for overall financial well-being, New Jersey had the lowest percentage of residents reporting that they did not worry about money in the past week, and Rhode Island had the lowest percentage of residents saying they were satisfied with their standard of living.”

 

Is the U.S. at Full Employment Yet?

Wall Street Journal: “The U.S. economy is at last on the cusp of full employment after years of sluggish recovery and widespread joblessness, according to economists in a Wall Street Journal survey.”

“The U.S. will be in a state of full employment within the first half of 2016, according to a 56% of the economists surveyed … Typically, when the economy reaches full employment, wage growth follows. But economists caution that may not happen quickly.”

“Even as the unemployment rate has fallen in recent years, other signs of weakness have lingered. In particular, the share of Americans participating in the workforce declined. That rate declined in September to 62.4%, the lowest share since 1977, a period when women were far less likely to work.”

“Despite full-employment nearly in grasp, economists say the future remains far from rosy. They lowered their average forecasts for growth of gross domestic product in this year’s third and fourth quarters. And around three-quarters say the economy is more likely to do worse than their forecast than better; a majority highlighted the risk to the U.S. economy from a global economic slowdown.”

“But if those risks are avoided, they see the economy adding between 180,000 and 190,000 jobs a month next year, with the unemployment rate dropping to 4.7%. Only five of the past 40 years have seen the unemployment rate so low.”

Unemployment Dips, But It’s Still a Shaky Job Market

Wall Street Journal: “The number of unemployed Americans dipped below eight million last month for the first time since 2008–but that figure doesn’t entirely reflect job growth.”

“Unemployment dropped to a new low the same month that 350,000 Americans exited the labor force, the Labor Department said Friday. The civilian labor force has shrunk three of the past four months since touching a record high in May.”

“One explanation for the trend is that Americans out of work for an extended period of time are giving up looking for jobs.”

“Why are workers leaving the labor force? It could be because relatively few unemployed are receiving jobless benefits. The number of Americans receiving ongoing unemployment benefits touched a 15-year low last month.”

 

Americans: Don’t Repeal Obamacare. Fix Our Soaring Medication Costs.

Wall Street Journal: “Attention has focused lately on new drugs with eye-popping prices and on a few whose price a new owner abruptly raised several-fold. But what many drug companies rely on for sales growth is a pattern of steady increases, year in and year out, on older medicines. Wholesale-price increases for the 30 drugs analyzed by the Journal averaged 76% over the five-year stretch from 2010 through 2014. That was more than eight times general inflation.”

“Pricing power helps some in the pharmaceutical industry to compensate for sluggish demand, new competition or weak product pipelines. ‘Pricing has covered up a multitude of other disappointments over the past 15 years’ in the sector.”

Americans have taken notice. In fact, according to The Hill, a recent poll by the Kaiser Family Foundation found “Americans have a greater concern for medication costs than they do about the Affordable Care Act.”

“The Kaiser poll indicates that, for the public, repealing ObamaCare is much less of a concern: 44 percent of respondents have a favorable view and 41 percent of respondents have a negative view. Only 28 percent of the respondents want outright repeal, but most likely they have real-world concerns with drug prices.”

What Are the Implications of the Troubling Jobs Report ?

Neil Irwin: “The September jobs numbers are easily the worst of 2015 so far. They offer an unpleasant combination of a bad overall headline, bad details and bad timing, amid a volatile and unsettling time in global markets.”

“The weak numbers offer some vindication for those Federal Reserve officials who preferred to hold off on interest rate increases last month to ensure the economy was on sound footing before tightening the money supply. They also give reason to worry that those wild market swings in August were less random fluctuations and more an indication that something deeper is wrong with the global economy — not so much that the stock market drop in August caused weak September jobs numbers, but that there is an underlying economic fragility causing both.”

“The question now is whether it means anything — whether the United States economic expansion, which seemed set to roar into 2015, is slowing in some meaningful way. We don’t know that yet, and it would be a mistake to leap to that conclusion. But that possibility became quite a bit more plausible after the September numbers popped onto economists’ computer screens.”

How Do Americans Feel About Their Financial Situation? So-So.

Gallup: “Half of Americans, on average, so far this year say they are feeling better about their financial situation. This may not seem like a highly positive state of affairs, but it marks a modest improvement from two years ago, when an average of 43% said they were feeling better about their finances.”

Are you feeling better about your financial situation these days, or not?

“These questions reflect not just the reality of how much money people have, but also how they think about their financial situation. Even though Americans are slightly more positive than they were two years ago, they are clearly not greatly optimistic about their financial situation, with just about half saying they are feeling better about it. And while Americans like to feel they are monitoring their spending closely and attempting to control how much they spend, these attitudes have not changed dramatically since 2013.”

The GOP: An ‘Insurgent Outlier’

Paul Krugman: “Bad as Mr. Boehner was, he was just a symptom of the underlying malady, the madness that has consumed his party.”

“The Boehner era has been one of budget blackmail, in which threats that Republicans will shut down the government or push it into default unless they get their way have become standard operating procedure.”

In the words of political analysts Thomas Mann and Norman Ornstein, “the G.O.P. has become an ‘insurgent outlier’ that is ‘ideologically extreme’ and ‘unmoved by conventional understanding of facts, evidence and science.’ And Mr. Boehner did nothing to fight these tendencies. On the contrary, he catered to and fed the extremism.”

“Mr. Boehner is quitting because he found himself caught between the limits of the politically possible and a base that lives in its own reality. But don’t cry for (or with) Mr. Boehner; cry for America, which must find a way to live with a G.O.P. gone mad.”

Does the Fed Need to Hike Interest Rates?

In her speech last Thursday, Federal Reserve Chair Janet Yellen reiterated her plan to increase interest rates this year despite doubts about the Fed’s ability to generate its 2% inflation rate target.

Matt Phillips in Quartz: “In explaining the Fed’s decision earlier this month to hold off on raising interest rates, Yellen highlighted persistently low market measures of inflation expectations. That’s a sign that the markets doubt the central bank’s ability to actually generate enough inflation to get back to its 2% target. And for good reason, the Fed has consistently been undershooting its inflation target in the aftermath of the Great Recession.”

Matthew Yglesias argues against a rate increase.

“Economic commentators seem to have a great deal of difficulty with this, but it’s time to admit that at the moment the United States simply isn’t facing a serious business cycle problem. Unemployment is on the low side, but so is inflation. Cheap commodity prices are giving everyone a boost, there are a lot of able-bodied adults who may or may not rejoin the workforce in the near future, and after a long stretch of weak wage growth there’s room for people to get some raises without corporate profits being squeezed to an untenable level.”

“Things are basically fine, and while a small increase in interest rates almost certainly wouldn’t be ruinous, there’s also no reason to do it.”

Texas Leads in Economic Growth for 2014

Wall Street Journal: “The fastest growing economies in the U.S. last year were largely found deep in the heart of Texas.”

“Half of the 16 U.S. metro areas where the economy grew at a 6% rate or better last year were in Texas, led by the energy-rich Midland region’s 24.1% advance in gross domestic product, the Commerce Department said Wednesday.”

“In Texas, Midland was followed by 11.4% growth in San Angelo and an 8.5% increase in Dallas. The fastest growing non-Texas areas were Lake Charles, La., up 10.3%, and Greely, Colo., up 9.9%.”

“The common theme among those regions is energy. Natural resources and mining, which includes oil and gas extraction, was a relatively small contributor to growth, on average, in U.S. metro areas. But for areas leading overall growth, it was among the biggest drivers.”

“Among the metro areas with the 25 largest economies, Dallas was the leader, followed by San Jose, Calif., up 6.7% and San Francisco, up 5.2%. The national largest metro economy, New York, increased 2.4%–matching the national increase in GDP.”

No, Obamacare Is Not a Job Killer

CNN: “Despite some dire predictions, Obamacare isn’t having much of an impact on hiring by businesses so far, according to a new study.”

“Employers with at least 100 full-time workers must offer health insurance to full-time employees who work 30 or more hours a week or pay a penalty, as of this year. This mandate will start applying to smaller companies with 50 or more full-timers in 2016.”

“But few employers report changing their staffing or hiring because of Obamacare, according to the 2015 Kaiser Family Foundation/Health Research & Education Trust survey, released Tuesday.”

“Only 4% of employers with at least 50 full-time workers said they shifted some staffers from full-time to part-time schedules so that they wouldn’t qualify for health care. And another 4% said they were reducing the number of full-time employees they planned to hire because of the cost of health benefits.”

“‘Despite all the debate about the so-called employer mandate…the actual employer response does not match the rhetoric,’ said Drew Altman, the foundation’s president. ‘It’s muted. It’s modest. It cuts in different directions with no big shift to part-time employment.'”

 

GOP Favored on Issues Despite Worse Image

Gallup: “Less than half of Americans (43%) view the Democratic Party favorably, but the party’s image is still better than that of the Republican Party (38%). Neither party has been able to gain favorable opinions from a majority of the public since June 2013, in the early months of President Barack Obama’s second term.”

“Yet while Americans are more likely to view the Democratic Party favorably, they are split on which party is better at keeping the country prosperous. Americans are slightly more likely to say the Republican Party is better at handling whatever issue they personally define as the country’s ‘most important problem,’ and much more likely to favor the GOP on ‘protecting the country from international terrorism and military threats.'”

Americans' Overall Opinions of the Two Parties and Views of the Parties on Issues

The Escalating Cost of Rent

Think Progress: “More than a quarter of renters in the United States have to put half of their income toward paying rent. But that’s not the bad news. The bad news is that things are almost certainly going to get worse.”

“A new report from Harvard University’s Joint Center for Housing Studies and Enterprise Community Partners Inc shows that in 2013, 11.2 million households who rented, or 26.5 percent of the total, were severely burdened, or their rent consumed more than half of their income. While that’s a slight dip from the record high of 11.3 million reached in 2011, it’s risen by nearly 60 percent, adding more than 3 million people, since 2000. About half of all renters are paying more than the recommended 30 percent of income toward rent.”

Washington Post: “In part, two longterm trends are colliding here. Rents have outpaced inflation for most of the last several decades. At the same time, incomes have been stagnating or falling … Here is what it’s looked like since just 2001:”