White House disputes claims 'Obamacare' will eliminate jobs

Criticism comes after CBO reports shows millions could leave work force due to ACA

Dental hygienist Cathy Fleming cleans a patient's teeth at Masterpiece Dentistry, on Nov. 6, 2013 in Boston, Massachusetts. Many uninsured people may soon be covered under Obamacare for medical, dental and eyecare insurance.
Melanie Stetson Freeman/Christian Science Monitor/Getty Images

The White House pushed back against a critical interpretation of a report on health care reform Tuesday, saying that claims by congressional analysts that the Affordable Care Act (ACA) will result in job losses are contradicted by facts in the study itself.

The Congressional Budget Office (CBO) said that several million American workers will cut back hours on the job or leave the nation's workforce entirely because of President Barack Obama's health care overhaul, adding fresh fuel to the political fight over "Obamacare."

But in a rebuttal of the findings, White House Press Secretary Jay Carney countered in a statement released soon after the report that 8.1 million jobs had been added to the private sector since the ACA was passed into law in March 2010 – the strongest 45-month job growth since the late 1990s.

“Claims that the ACA hurts jobs are simply belied by the facts in the CBO report,” the White House statement said.

“CBO’s findings are not driven by an assumption that ACA will lead employers to eliminate jobs or reduce hours, in fact, the report says itself that there is ‘no compelling evidence that part-time employment has increased as a result of the ACA.,’” it continued.

According to the CBO report, workforce changes would mean nationwide losses equal to 2.3 million full-time jobs by 2021, in large part because people would opt to keep their income low to stay eligible for federal health care subsidies or Medicaid.

Republican lawmakers seized on the report as new evidence of what they consider the failures of Obama's health care overhaul, which they have been trying to overturn and are planning to use as a main argument against Democrats in November's midterm elections.

It's the latest indication that "the president's health care law is destroying full-time jobs," said Republican Rep. John Kline of Minnesota, chairman of the House Education and the Workforce Committee. "This fatally flawed health care scheme is wreaking havoc on working families nationwide," he added.

But the White House said the possible reduction would be due to voluntary steps by workers — people having the freedom to retire early or spend more time as stay-at-home parents because they no longer had to depend only on their employers for health insurance — rather than businesses cutting jobs.

“What the CBO report does find is one key immediate effect of the ACA is to ‘induce some employers to hire more workers or to increase the hours of current employees’ during the 2014-16 period,” the White House statement said, adding that experts have estimated that that slower growth in health costs due to the ACA will cause the economy to add an additional 250,000 to 400,000 jobs per year by the end of the decade

CBO Director Douglas Elmendorf said the top reason people would leave a job or reduce their hours would be to qualify for subsidized coverage and an expanded Medicaid program, but that lower wages — because of penalties on employers who don't provide coverage and looming taxes on generous health care plans — would also be a factor.

Lower-wage workers are more likely to reduce their hours or quit their jobs because of ACA incentives, the report said.

“The estimated reduction stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in businesses' demand for labor," the report said.

The health care analysis is layered with complexity. The job losses are measured in "full-time-equivalent workers," which means more people could actually be affected than the 2 million “full-time-equivalent jobs” projected to be lost in 2017. It could take several part-time workers or people deciding to reduce their hours to produce the wage loss of one full-time equivalent.

The report also contains an important caveat, that the estimate of job losses is "subject to substantial uncertainty" and could be larger or smaller than predicted. There now are more than 130 million jobs in the economy.

The White House statement added that “moreover, CBO does not take into account positive impacts on worker productivity due to ACA’s role in improving workers’ health, including reduced absenteeism.”

Al Jazeera and wire services

Find Al Jazeera America on your TV

Get email updates from Al Jazeera America

Sign up for our weekly newsletter

Get email updates from Al Jazeera America

Sign up for our weekly newsletter