Over at PostEverything.
Key points: Clearly, this economic recovery has evolved too slowly and is still not reaching enough of us. Just as clearly, it is improving, particularly in the job market. I stress both these themes in my recent testimony before the Joint Economic Committee (JEC).
But based on a June spike in the monthly number of part-time workers, too many critics are trying to make the case that we have a structural problem of too much part-time employment–some add that Obamacare is too blame.
Not so. Involuntary part-time work, while still elevated, is down almost 20% over the recovery, while voluntary part-time work is about where it was five years ago. According to White House economists, “88 percent of the jobs added [over the recovery] have been full time, and that number is 99 percent in the last year.”
And there’s nothing wrong, btw, with voluntary part-time work. In fact, as I boldly assert:
There’s nothing wrong, and a lot right, with voluntary part-time work. There’s not even anything wrong with affordable health care coverage allowing involuntary full-time workers to work less and still maintain coverage. That’s unequivocally good!
Source: BLS
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Voluntary part-time work would seem to be an integral part of absorbing labor market slack. It fills the potholes in the road, so to speak. Voluntary part-time work also fills the void between long-term unemployment and less attractive remedies to employment frictions. The next civilized achievement may be work less, live better. Why not?
Work less, live better should be the goal of economics. With technological innovation, food and consumer goods become cheaper and more abundant. The result is living better on less work. That is a good thing.
But it is a bad thing if, for example, Chinese children are denied healthcare because their govt chose to loan money to the US so that Americans can work part time on subsidized healthcare.
It’s a bad thing if the local welder is forced to work overtime to cover rapidly rising costs of healthcare so that a hipster (helped out by his parents, unlike welder man) in Brooklyn can get subsidies for working only part time in his band.
Scroll down to the graph on page 59 http://www.treasury.gov/resource-center/tax-policy/tax-analysis/documents/ota100.pdf
Don’t know how Piketty treated issues of gift tax in his book, but that is the issue central to parental hipster help. If hipster help is gift taxed, it covers his healthcare. Welder man pays no extra burden. What is unfair is if welder man makes less full time than hipster part time, as mobile web design pays so much more than depressed blue collar wages.
http://www.bls.gov/ooh/production/welders-cutters-solderers-and-brazers.htm
http://www.bls.gov/ooh/computer-and-information-technology/software-developers.htm
Taxing is the least efficient model for wealth redistribution. It can alter behavior, but making part time wages more than full time may induce more full time work. Additionally, with the current tax code, we incentivize robotics and automation by writing those pieces of software or equipment off as business costs (including depreciation tax shields) while taxing the hell (income taxes, SS/ MEDICARE matches etc) and regulations requiring workmen’s comp, unemployment insurance etc. creating a dis-incentive on hiring humans. It should be the opposite. Tax the equipment and all of consumption and move away from income taxes. Raise minimum wage so as to efficiently move money to the working poor instead of inefficiently taxing up to Washington D.C. only to go back down to recipient.