Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at intelligent and rational individuals, whose comments are very welcome.

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04 November 2012

Obama's New Normal Part-Time Economy

Average hours worked for all non-farm private employees has been stuck at 34.4 hours for 4 months now.  The average hours for non-farm private production and non-supervisory employees dropped 0.1 hours in October to 33.6 hours.

Real per capita GDP is $50,166 through the third quarter, but it would be $55,932 if long-term historical trends had not been replaced by the Obama "new normal."  This loss of $5,766 per person is sorely felt.  High unemployment and all-too-common part-time employment has kept the economy from expanding at historic rates.

As Mike Shedlock has noted, the recovery of hours worked following the period of nominal GDP contraction shown in the light blue region of the plot below has stalled out.  The earlier rate of increase was substandard following a recession.  For many months now, Obama's "new normal" has settled in.  The question is, are Americans ready to settle for the Obama "new normal."

There is no reason at all to do so.  The U.S. economy is more than ready to recover, if only Washington will stop doing everything it can to prevent business success.  One of the big factors is the pressure that ObamaCare, really ObamaUncaringTax, is putting on businesses to convert full-time positions into part-time positions.  ObamaCare defines full-time employment for the purposes of requiring health insurance coverage or the payment of a penalty by the business as a mere 30 hours of work a week.  As a result, many businesses are putting a limit of 25 to 28 hours a week on their employees.  The tax assessment on employees requires a look-back period of 3 months to a year, to be selected as an option by the employer.  Consequently, companies have had to ensure that at the latest, many of their employees had less than 30-hour workweeks for more than the last 3 months of this year.  The Obama "new normal" is a 25-hour workweek for many Americans.

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