Rising Cost of Health Benefits Cited as Factor in Slump of Jobs

[papau]

"A relentless rise in the cost of employee health insurance has become a significant factor in the employment slump, as the labor market adds only a trickle of new jobs each month despite nearly three years of uninterrupted economic growth,"

http://www.nytimes.com/2004/08/19/business/19care.html

August 19, 2004
Rising Cost of Health Benefits Cited as Factor in Slump of Jobs
By EDUARDO PORTER

relentless rise in the cost of employee health insurance has become a significant factor in the employment slump, as the labor market adds only a trickle of new jobs each month despite nearly three years of uninterrupted economic growth.

Government data, industry surveys and interviews with employers big and small indicate that many businesses remain reluctant to hire full-time employees because health insurance, which now costs the nation's employers an average of about $3,000 a year for each worker, has become one of the fastest-growing costs for companies. Health premiums are sapping corporate balance sheets even more than the rising cost of energy.

In the second quarter, the cost of health benefits rose at a 12-month rate of 8.1 percent - more than three times the inflation rate and the rate of increases in wages and salaries.

"Health care is a major reason why employment growth has been so sluggish," said Sung Won Sohn, the chief economist at Wells Fargo.

Although the economy emerged from recession long ago, posting 11 straight quarters of growth, there are still about a million fewer jobs in the United States than there were at the beginning of 2001, just before the country sank into recession. <snip>

[ramapo]

1. 13% increase for my company

The increases are relentless, 13% this year. We're holding benefits and employee contributions at the same level and will absorb the increase as we've had to cut back benefits and increase employee share previously in order to maintain some level of affordibility.

Solving this problem would help on so many levels. This would reduce costs to companies, give peace-of-mind to us all, provide workers with freedom to change jobs or start businesses without being constrained by health insurance concerns.

Why we cannot go to a single-payer system that would at least suck the bureaucracy out the system defies common sense.