Picture this, tomorrow you march into your boss’s office and demand a $100,000 raise. What do you think? Would you walk out of that office with a job? What if you demanded a $2,000 or $3,000 raise? Perhaps that is more likely. But it should be no shock that companies have been laying of tens of thousands of workers now that Obamacare is the permanent law of the land.
Starting in 2014, companies with 50 or more employees must offer their employees corporate health insurance plans, or employee #50 will cost the company an additional $100,000-$150,000 in taxes. That’s $2,000-$3,000 per person. So if you are employee #50, you may want to brush up your resume. In fact, if you are employee 50-100 you may be starting to sweat just a little bit.
So why won’t companies simply offer their employees health insurance? Probably because with a price tag of $16,000 per family for a corporate plan, it simply isn’t economical. Companies could pay their employees the $5,000 or so for a private plan through a defined contribution benefit package as Sears, Darden Restaurants and others are opting to do, but that does not save them from the $100,000+ tax. Imagine being able to get money from your company to go out and buy your very own tailored healthcare plan where single men don’t have to pay for maternity and women don’t have to insure against testicular cancer. Unfortunately, the insurance lobby was able to convince Obama that personal choice is a bad idea.
I’ve heard a lot of people suggest that companies who are laying off en masse are doing so only to protest the Obama re-election. Yes, that’s right, companies are intentionally hurting themselves to show Obama how upset they are. Really?? That would be like suggesting a pro-choice lesbian would get knocked up and have a baby to protest a Romney win.
It’s more like this, if a company can’t afford to pay $16,000 per family in health insurance coverage, they just might lay off 200 workers in order to save between $400,000 and $600,000. By the way, most small businesses with 5o employees can’t afford $100,000 in additional taxes.
If you think companies are just bitter and that is why job losses are up 78,000 since the election, consider this: with Obamacare companies just saved $156 million by laying off those 78,000 workers. Obama is incentivizing layoffs by taxing employment.