The End of Full-Time Work in the US Retail Service Sector

Frequent readers will know that I have been predicting for over a year that the economic story of 2013 would be the end of full time work in the retail service sector due to the PPACA, or Obamacare (example).   QED, from the most recent economic report:

In June, the household survey reported that part-time jobs soared by 360,000 to 28,059,000 – an all time record high. Full time jobs? Down 240,000.  And looking back at the entire year, so far in 2013, just 130K Full-Time Jobs have been added, offset by a whopping 557K Part-Time jobs.

It is unclear how the 1-year delay in the employer mandate implementation will affect this.  Probably not a lot -- based on the way Obamacare was being implemented, companies needed to be switching workers to part-time now (really, early this year) so that they would qualify as part-time for next year  (a company needed 6-12 months of records from this year to prove the employee was part-time).  In other words, most companies have already switched, and having done so, will not likely switch back just for one year.

Besides, as I have written before, it is actually cheaper and easier for many retail establishments to stitch together full coverage of their business hours from part-time workers.   Making jobs full-time is a hassle, and was done by most of us mainly for competition reasons, ie to be able to attract the best employees.  Other laws like California's absurd lunch-break mandate (which has caused me to make working through lunch a firing offense at our company) just add to the cost of offering full-time work.   If everyone is only offering part-time, and the labor market is weak with plenty of workers available, there is no reason to go back to offering full time employment.


  1. mesaeconoguy:

    This compositional change to the workforce requires a shift to tracking unemployment, specifically to the U-6 number, which tracks under- and unemployment, including part-time.

    That number rose from 13.8% to 14.3% in the June reading, and is indicative of a sclerotic and sickly labor market.

    The headline number of 7.6% is now meaningless, and should be ignored completely.

    Obamascare is in process of destroying not only job growth, but also full time employment. I would not be surprised at all to see the U-6 number in the 15 – 20% range soon.

  2. herdgadfly:

    I see that California is also leading the charge to outlaw unpaid internships. Don Boudreaux at Cafe Hayek makes a compelling argument that mutually beneficial internships are actually a form of barter.

  3. Joe_Da:

    Paul Krugman, the nobel prize winner seems unable to grasp this concept.

  4. Bob:

    What I am trying to figure out is how can Obama just decide to wait a year? Wouldn't they have to pass a bill changing the implementation date?

  5. dad29:

    In NYC, "employee-sharing" is the next big thing. Two employers will hire the same person, and that person works 25 hours at employer A and 25 (maybe more or less) at employer B.

    No full-time employment, but 50 hours' work!

  6. mesaeconoguy:

    Technically, yes, but as we are now seeing, both House and Senate Republicans are making noises to delay the individual mandate, either temporarily or permanently

    Maybe we can get John Roberts to chime in here too, and give his 2 cents, since all 3 branches of gov’t can now apparently do whatever they want.