Coyote Blog

Sorry, but it is not the fiscal cliff.   It is the complete shift in the US labor model, at least in the service sector, due to Obamacare.

Here is what I am doing for the rest of the year -- working with every manager in my company so that as of January 1, 2013, none of our employees are working more than 28 hours a week.   I think most readers know the reason -- we have got to get our company under 50 full time employees or else I am facing a bill from Obamacare in 2014 that will be several times larger than my annual profit.  I love my workers.  They make me a success.  But most of my competitors are small businesses that are exempt from the Obamacare hammer.  To compete, I must make sure my company is exempt as well.  This means that our 400+ full time employees will have to be less than 50 in 2013, so that when the Feds look at me at the start of 2014, I am exempt.  We will have more employees working fewer hours, with more training costs, but the Obamacare bill looks like about $800,000 a year for us, at least, and I am pretty sure the cost of more training will be less than that.

This will be unpopular but tolerable to most of my employees.  The vast majority of them are retired and our company is merely an excuse to stay busy, work outdoors, and get a little extra money.

But this is going to be an ENORMOUS change in the rest of the service sector.  I have talked to a lot of owners of restaurants and restaurant chains, and the 40-hour work week is a thing of the past in that business.  One of my employees said that in Hawaii, it was all the hotel employees could talk about.   Many chains are working on mutli-team systems where two teams of people working part-time replace the former group of full-time employees.  2013 is going to see a lot of people (who are not paid very well to begin with) getting their hours and pay cut by 25%.  At the same time that they are required, likely for the first time since many are relatively young, to purchase health insurance.

It will be interesting to see what solutions emerge.  My bet is that it will become standard for people in the service sector to work two different jobs for 20-25 hours each with two different companies.  This will be a pain for them, but allow them to keep their income up.  The hard part may be coordinating shifts between companies.  For example, a company that divides their shifts into mon-tue-wed vs. thu-fri-sat cannot share employees with one who divides their shifts between morning and afternoon.  If given time, I would guess that just as the mon-fri workweek emerged as a standard, companies may adopt standard ways of dividing up the work weeks for part-timers, making it easier for schedules to mesh.

• Migrated about 20 web sites to my new server (actual a virtual private server rather than a dedicated server, but it seems to have most of the functionality of dedicated at a lower price -- performance remains to be tested).  This was sort of a death march as it was incredibly dull and repetitive, especially since many of the sites use WordPress as the content management system so they required database setup and migration as well.  Basically got almost everything done except this site.  I am sure after 20 smooth moves Murphy's Law will cut in on the largest and most complicated.
• Created our Christmas / Holiday card.  Some 20 years ago I set the unfortunate precedent of trying to do something unique for our cards, so I have made this a double extra more time consuming process than it has to be.  (past examples here, here, here)
• Made a lot of progress laying track on my model railroad.  All my track is scratch built (from rails and ties) and so it takes a while, but I have nearly all the major switches in place, which are the real time consumers when hand laying track
• Created a second RAID for my home theater system.  Incredibly, the original 8Tb raid (5x2 TB drives in a RAID 5) is almost full.  Chalk this up in part to Blu Ray rips (which can be 30Gb each) but also to my finally ripping TV series I have on disk (Sopranos, Mad Men, Firefly, etc).  These involve a lot of disks.

At some point soon I want to write a review of my experience with the new SageTV version 7.0 software, which is an ENORMOUS improvement over their old versions.  The Sage system is still for advanced users, but the process for managing plugins and extensions (the whole point of Sage is its customizability) is greatly improved.  The new HD300 set top box is also improved, though with a flaw or two.  You are welcome to email me if you are considering Sage (or if you want something more capable than most media streaming boxes) and I can give you the pros and cons.

Now all I need is a few Christmas present ideas for my wife.

Robert Samuelson makes the point I made here:

The standard story is that poverty is stuck; superficially, the

statistics support that. The poverty rate measures the share of

Americans below the official poverty line, which in 2006 was $20,614

for a four-person household. Last year, the poverty rate was 12.3

percent, down slightly from 12.6 percent in 2005 but higher than the

recent low, 11.3 percent in 2000. It was also higher than the 11.8

percent average for the 1970s. So the conventional wisdom seems amply

corroborated.

It isn't. Look again at the numbers. In 2006, there were 36.5

million people in poverty. That's the figure that translates into the

12.3 percent poverty rate. In 1990, the population was smaller, and

there were 33.6 million people in poverty, a rate of 13.5 percent. The

increase from 1990 to 2006 was 2.9 million people (36.5 million minus

33.6 million). Hispanics accounted for all of the gain.

Consider:

From 1990 to 2006, the number of poor Hispanics increased 3.2 million,

from 6 million to 9.2 million. Meanwhile, the number of non-Hispanic

whites in poverty fell from 16.6 million (poverty rate: 8.8 percent) in

1990 to 16 million (8.2 percent) in 2006. Among blacks, there was a

decline from 9.8 million in 1990 (poverty rate: 31.9 percent) to 9

million (24.3 percent) in 2006. White and black poverty has risen

somewhat since 2000 but is down over longer periods

This is not a ding on immigration, as readers will know I am a supporter of open immigration.  But it is an important context to have when evaluating poverty numbers.  The drop in black poverty in these numbers is an ENORMOUS piece of good news that I bet you have not read anywhere.

Robert Samuelson makes the point I made here:

The standard story is that poverty is stuck; superficially, the

statistics support that. The poverty rate measures the share of

Americans below the official poverty line, which in 2006 was $20,614

for a four-person household. Last year, the poverty rate was 12.3

percent, down slightly from 12.6 percent in 2005 but higher than the

recent low, 11.3 percent in 2000. It was also higher than the 11.8

percent average for the 1970s. So the conventional wisdom seems amply

corroborated.

It isn't. Look again at the numbers. In 2006, there were 36.5

million people in poverty. That's the figure that translates into the

12.3 percent poverty rate. In 1990, the population was smaller, and

there were 33.6 million people in poverty, a rate of 13.5 percent. The

increase from 1990 to 2006 was 2.9 million people (36.5 million minus

33.6 million). Hispanics accounted for all of the gain.

Consider:

From 1990 to 2006, the number of poor Hispanics increased 3.2 million,

from 6 million to 9.2 million. Meanwhile, the number of non-Hispanic

whites in poverty fell from 16.6 million (poverty rate: 8.8 percent) in

1990 to 16 million (8.2 percent) in 2006. Among blacks, there was a

decline from 9.8 million in 1990 (poverty rate: 31.9 percent) to 9

million (24.3 percent) in 2006. White and black poverty has risen

somewhat since 2000 but is down over longer periods

This is not a ding on immigration, as readers will know I am a supporter of open immigration.  But it is an important context to have when evaluating poverty numbers.  The drop in black poverty in these numbers is an ENORMOUS piece of good news that I bet you have not read anywhere.