One of the biggest issues that the Affordable Care Act (ACA) is meant to tackle is the lack of health coverage among low-wage workers. While there is good news for many low-wage workers in the new law, many others will still find themselves locked out of access to affordable coverage. Solving their concerns will be one more part of the huge challenge of confronting the power of mammoth low-wage employers in the new economy.
There has been a lot of coverage about the potential for fast food chains and other employers to cut the hours of some of their employees to under 30 a week in order to avoid having to offer them health coverage. To the extent that employers do cut back hours, it will accelerate a long-trend toward part-time low wage work; part-timers increased from 17 percent to 22 percent of the workforce just from 2007 to 2011.
The surge in part-time work is one aspect of the broader increase in low-wage work. Most of the jobs coming out of the recession are low-wage, which has hastened a trend going back 30 years of a growing number of low-wage jobs with no health benefits. The powerful eroding of good jobs is the greatest threat to broadly-shared economic prosperity. It destroys any promise of people living a middle-class life style, creates a two-tiered society, and undercuts the consumer buying power needed to move the economy forward.
The low-wage economy means more than just low wages. Post-World War II jobs, which came with employer-provided health coverage and a pension, are fast disappearing. Now more than four-in-ten workers do not get health coverage on the job. This includes many employees of small businesses, which do not offer any health coverage. It also includes millions of employees of large businesses, who either are not offered health coverage or can’t afford the premiums.