Confirmed: Obamacare Discourages Work

CBO Director Doug Elmendorf told an audience on Friday that Obamacare will likely shrink the amount of labor used in the economy by as much as 651,000 jobs.
Investors.com reported:

Congressional Budget Office director Doug Elmendorf said Friday that ObamaCare includes work disincentives likely to shrink the amount of labor used in the economy.

In a speech on ObamaCare’s economic impact outside the health care sector, Elmendorf said that those effects will primarily be related to the labor market and “will probably be small.”

Factoring in additional demand for workers in health care and insurance, CBO estimates that “the legislation, on net, will reduce the amount of labor used in the economy by roughly half a percent,” he said.

The reason: The expansion of Medicaid and new health insurance subsidies will reduce “the amount of labor that workers choose to supply.”

(For perspective, half a percent of current payrolls is 651,000 jobs, though the impact would show up in both fewer jobs and fewer hours worked.)

The conclusion isn’t a surprising one; any extra support from the government takes some pressure off of workers to provide for themselves. However, ObamaCare’s progressive subsidies, i.e. more generous for those who earn less, carry more of a disincentive than the flat, universal benefit favored by some Republicans.

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