Part Time America

(Image source: Federal Reserve)

Finally, and most troubling, is the boom in part-time employment for economic reasons. In the current jobs report, part-time workers increased to 8.25 million.[ii] Part-time work accounted for more than 65 percent of the positions employers added in July[iii].

(Image source: Federal Reserve)

While there is a slight improvement since the financial crisis, it's disturbingly high. Low-paying retailers, restaurants and bars supplied more than 40 percent of July's job gains.[iv]

Over the long-run (5 years or more) it's difficult to make the case for growing consumption without more people being put to work full time.

One cause of the boom in part-time employment is the concern over Obamacare. Employers with fewer than 50 employees have a direct incentive to not cross that threshold due to penalties associated with not-providing health care or being forced to provide coverage.

Since the Census Bureau does not specifically list companies with 50 employees or fewer, we can estimate that number to be 5.6 million, out of 5.9 million total employer firms.[v]

That's 26.31% of all employees and 93.73% of all firms. This is no small matter.

Another likely cause is companies want to maintain profit margins, and hiring full-time workers without a clear pick-up in demand does not fulfill that mandate.

A flexible workforce (code for part-time workers) is a much better proposition for those that own companies versus those that don't. You can simply look at union membership to see how expensive labor is doing in our country.[vi]