For decades people have relied on Robert Samuelson to give a confused rendering of economic reality in the pages of the Washington Post. He came through again today in his warnings about an explosion of part-time work.
The centerpiece of Samuelson's concern is a reported, "whopping — 1,115,000 — increase in part-time jobs offset by the 708,000 loss in full-time jobs." Yes, that sounds pretty worrying. The number of full-time jobs is plunging.
The reason that you are hearing this concern raised by Robert Samuelson and not by any of the economists or analysts who commented on the June jobs report is that the latter group understands the volatility of the data in the household survey from which the numbers on part-time work is obtained. It is not uncommon to see sharp month-to-month movements in part-time or full-time work. This is why economists generally ignore the month to month changes in these numbers in the household survey and rely instead on longer period changes, like year over year comparisons.
If Robert Samuelson had written this piece last month, before the release of the June data, he could have been decrying the disappearance of part-time work, since the economy had lost 318,000 part-time jobs in the prior two months. No one can believe that we really saw a sharp drop in part-time in April and May, only to be reversed by a huge surge in June. These numbers are simply errors in the survey. This is why no one raised the monthly movements.
There is an interesting story if we look at the year over year numbers. These numbers do show an increase in the number of part-time work, but all on the voluntary side. Voluntary part-time employment increased by 840,000 from June of 2013 to June of 2014. At the same time involuntary part-time employment fell by 650,000, leaving a net gain of 190,000. Since this was accompanied by a year over year change in total employment of 2,146,000 jobs, it implies a gain in full-time employment of 1,956,000 jobs. Are you scared?
There is actually a story (a good one in my view) of increased part-time work. Many people would prefer to work part-time. They have young children or ill family members they would like to spend time with. Or, they may be older workers who would like to partially retire. Before the passage of the Affordable Care Act these people might have worked full-time because this was the only way they could get health care insurance. However now that they can get insurance on the exchanges, they have the option to work part-time. I don't see the problem with this.
Samuelson does raise the issue that employers are cutting workers hours to less than 30 to avoid the employer sanctions that apply to firms who have more than 50 full-time employees but don't provide health care insurance. The imposition of these sanctions has been delayed, but Helene Jorgensen and I looked at the evidence that such hours reductions were happening in the first half of 2013 when employers thought the sanctions would apply to them. (The Obama administration announced the delay of the sanctions in early July of 2013.) There was none.
(Only one link allowed per comment)