Health Care Reform: How a Drop in ‘Job Lock’ Could Benefit Your Business

Newsflash: Not everybody likes their job.

Shocker, right? But the Affordable Care Act, aka health care reform, makes it easier for workers to leave jobs they might not be completely gung-ho about.

And some of them could give your business a boost.


‘Job lock’ picked

One of the key tenets of the legislation is creating widespread access to affordable health coverage.

No more worries about being denied because of a pre-existing condition, and new places to shop for health insurance (i.e., federal and state exchanges).

That means no more hanging on to a job you’re not in love with simply because you don’t want to lose your health coverage – a phenomenon commonly referred to as “job lock.”


Tomato, tom-AH-to

The effects of a decline in job lock are highly debatable, of course. A February 2014 report from the Congressional Budget Office (CBO) estimates a 1.5-2 percent drop in total number of hours worked from 2017-2024, largely due to health care reform.

Spin that data one way, and you get this:

  • The equivalent of 2.5 million fewer full-time positions by 2024
  • Less incentive to work due to increased taxes and financial incentives to keep earnings low (such as increased subsidies at the health insurance exchanges)
  • And, therefore, more dependency on government “handouts”

Spin it the other way, and you get this:

  • American workers retiring earlier, instead of hanging on until they’re eligible for Medicare
  • People quitting a second or part-time gig to spend more time at home with the kids, go back to school, write a novel, paint a masterpiece and so on
  • Increased entrepreneurship as some go into business for themselves
  • Talented individuals looking for employment elsewhere

For the purposes of this article, we’ll focus on the hard-working, skilled individuals who are leaving a job they dislike to pursue their dream of a better, more fulfilling career.


What it means for your business


Over the last few decades, health insurance has often been tied to employment. If an employee wanted to keep his coverage, he had to stay at his job. This was especially true if the employee suffered from a pre-existing condition.

But health care reform changed all that. Because it provides expanded access to health insurance, Americans can get the coverage they need without depending on their employer to offer it.

If you’re a company looking to land some of this freed-up talent, there are a couple things you can do to attract these individuals, including:

  • Beefing up your recruiting efforts (since you won’t be the only one looking)
  • Making sure you offer competitive benefits (since health insurance is something these job seekers will be looking for anyway)
  • Putting your positive company culture on display (since that may be what was missing at their last gig)

It might not be all good for your organization, however. Perhaps yours is the company these workers are trying to get away from.

If that’s the case, let them go. Employees who aren’t engaged in helping your business succeed – for whatever reason – are better off elsewhere. And you’re probably better off without them.

Entrepreneurial effect


A downtrend in job lock may also lead to an increase in entrepreneurship, as both young and old brave the business world in an attempt to build their own small firms.

Those at the younger end of the spectrum get a boost from health care reform. They can remain on their parents’ health insurance plan until they turn 26. Others bring years of industry experience to their entrepreneurial endeavors.

But age really doesn’t matter when it comes to those who start small businesses. They bring dedication, energy and innovation to the marketplace, and all have the potential to create more American jobs down the road.

That’s good for everybody.

Learn how Insperity can help your company handle health care reform issues of all kinds.

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