The Labor Department said earlier this year that there are more temp workers in the U.S. than there ever have been before, and statistics suggest that number is only likely to grow. Nearly a fifth of the overall job growth since the economy started rebounding in 2009 has been temporary employment, and every day, millions of temps flock to a staffing franchise like AtWork Group in their local area to find work.
Now, employers are making arrangements for new requirements under the Affordable Care Act. Under the healthcare reform mandate, large companies with more than 50 employees working 30 hours a week or more must either provide insurance benefits or pay a penalty tax. There’s a good chance that many employers are going to find ways around the penalty, either by keeping their payroll below 50, or by shorting employees on hours so they don’t qualify for benefits. Some smaller, independent companies might not have the resources to pay for insurance for everyone. Other, larger corporations might not want to.
So what does that mean for a staffing franchise like AtWork Group, or the temporary workers and companies who make use of our services? In a study about the healthcare mandate, IQ Navigator says that the Affordable Care Act will increase the cost of labor for direct hires. That means more administrative paperwork and requirements for reporting to the government, and companies must decide whether to provide coverage for low-wage, full-time workers, or scale back their hours and fill in the labor demand with temps.
More companies are already turning to staffing agencies to recruit new labor, even if they intend to eventually offer full-time work to some of those staffers. IQ Navigator predicts that number will only rise as companies strive to keep labor costs to a minimum.
The employer mandate takes effect January 1, 2015, so there’s still a little over a year to be prepared. However, 2014 will be a telling year; payroll profiles and individual work histories recorded next year will determine exactly how the Affordable Care Act will impact the employment landscape going forward.