Policy makers have long feared that the Patient Protection and Affordable Care Act of 2010, often referred to as “Obamacare,” would have chilling effect on employers and small businesses due to its health care coverage requirements. On Friday, a poll quantified the negative effect “Obamacare” is having on hiring. That poll showed that 41 percent of surveyed businesses have frozen hiring as a result of the new law. 19 percent, nearly a fifth of all businesses, confessed to laying off staff in order to avoid penalties in the new law.
The Gallup poll, commissioned by the firm Littler Mendelson, surveyed 603 small businesses which have less than $20 million in annual sales. The poll shows how significantly the economic recovery from the 2008 recession has been held back because of the law.
Along with the businesses that have admitted to hiring freezes or downsizing, 38 percent of small business said that they have “pulled back on their plans to grow their business” because of the health care law.
9 percent of respondent businesses said that the new law would be “good” for their businesses while 39 percent said they have experienced “no impact.”
Companies with more than 50 full-time employees under the new law must either offer full health coverage or face a $2,000 fine per worker after the first 30. The law is forcing employees to pull back on hiring and reduce employees’ hours from full to part-time in order to avoid paying fines or providing health coverage.
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