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Will second Obama term have chilling effect on hiring?

By   /   November 15, 2012  /   No Comments

By M.D. Kittle | Wisconsin Reporter

MADISON — Gary Miskimins may need to bring in some bigger tips.

Miskimins, a full-time delivery driver at Papa John’s Pizza in Neenah, tells Wisconsin Reporter he’s worried the franchise may have to reduce full-time position — and the health-care benefits that go with it — in the implementation of the Patient Protection and Affordable Care Act.

Papa John’s CEO John Schnatter has said his national pizza chain will be forced to raise the price of pizzas and cut positions and employee hours to cover the costs of the health-care act, known derisively by opponents as Obamacare. Consumers and employees, Schnatter said, would ultimately have to bear the brunt of the additional costs of the federally mandated program.

Papa John’s, the world’s third largest pizza chain, boasts about 3,900 locations across the United States and in some 30 international markets, the vast majority of the stores owned by franchisees. Schnatter, who reportedly owns more than 20 percent of the chain, said the about 3,330 franchised locations would be forced to trim payrolls.

That’s what has Miskimins, a 15-year Papa John’s employee, worried.

“I feel if I lose hours and they want me to buy insurance, I can’t afford it. I think it’s totally wrong for the small guy, like me,” he said.

The delivery driver said he learned about the pizza policy squabble online, the domain, coincidentally, of a liberal campaign to boycott Papa John’s. Miskimins, unlike the boycotters, blames the federal government, not his employer, for some potential tough economic decisions ahead.

And the problem isn’t just about pizza.

Hitting home?

Wisconsin’s business advocates, admittedly opponents of President Obama’s re-election, say employers may stall hiring because of the election results.

Badger State business advocates tell Wisconsin Reporter employers may be balking on hiring not just because of the looming health-care mandates, but because of the re-election of President Obama, the namesake of the Affordable Care Act.

“I have heard of a number of companies that have put expansion plans on hold,” said Scott Larson, executive director of the Marshfield Area Chamber of Commerce and Industry in Marshfield.

“I think there was a great deal of anticipation rolling up to the election and I think, given the results, a lot of businesspeople are looking at this as basically a continuation of past several years,” added Larson, who also serves on the Wisconsin Manufacturers & Commerce Board of Directors.

WMC is conducting a survey of its members statewide on the economic environment, including hiring trends, post-election. The mood, at least anecdotally, is dour. Officials say the report is slated for release at a statewide economic conference the week after Thanksgiving.

WMC points out the Obama administration produced a record amount of regulations, more than 11,000 promulgated in his first term. Chief among the rules and regulations is an Affordable Care Act, which is erroneously named because it does nothing to reduce the rising cost of health care, said Kurt Bauer, WMC president and CEO.

“It increased demand without similarly increasing supply.”

Fabien Levy, spokesman for the U.S. Department of Health and Human Services, pointed to the success in Massachusetts, a pioneer in state-administered public health care under Republican presidential candidate Mitt Romney. HHS uses Massachusetts as an example of health-care cost savings with little impact on business.

The spokesman also pointed to a 2009 Families USA report that calculated average American families pay more than $1,000 in a “hidden health tax” in covering the costs of the uninsured. Millions of uninsured Americans will be covered under the mandatory health-care act, drastically reducing the extra costs, the department asserts.

Levy did not email a response to Wisconsin Reporter’s question: What does HHS say about comments that hiring will stall because of (the) ACA?

Officials from the U.S. Department of Labor, too, did not return Wisconsin Reporter’s calls and emails with comment on the issue.

Bauer and other business advocates contend Wisconsin is in a better position than the national economy due to regulatory reforms and tax breaks and incentives under Gov. Scott Walker and fellow Republican legislative leadership.

An updated report by the federal Bureau of Labor Statistics issued Thursday shows Wisconsin’s economy added 35,379 private-sector jobs from June 2011 to June 2012.

But Bauer acknowledges trouble in the national and global economies will weigh on Wisconsin’s recovery.

While there is the presumption of some sour grapes in some of the hiring assessments — that is entrepreneurs unhappy about Obama’s re-election — Bauer said a feeling of dissatisfaction pervades the business community.

“I think we’ve done things right. I only wish the president had followed a Scott Walker model as opposed to more of a (former Democratic Gov.) Jim Doyle model,” Bauer said. “But the election is over and the people have decided. The business community is going to have to manage through this environment.”

For Miskimins, the fear is that the political adage proves dangerously true: Elections have consequences.

The pizza delivery man says he’s waiting and worrying, trying to figure out his next potential step.

“I’ll probably have to get another part-time job, at least, just to keep a roof over my head and food on my table,” he said.

Contact M.D. Kittle at [email protected]


Better than previously reported

Wisconsin’s private-sector employers added 35,379 from June 2011 to June 2012, the state Department of Workforce Development said on Thursday, after conducting its second-quarter employment survey of businesses.

Seasonally adjusted unemployment also fell to 6.9 percent, according to the BLS numbers, compared to 7.9 percent nationally. Initial reports had indicated Wisconsin lost 13,700 private-sector jobs the June 2011-to-June-2012 period.

“We are encouraged that actual job counts show year-over-year gains in the private sector, with manufacturing accounting for thousands of these new jobs,” DWD Secretary Reggie Newson said in a statement.

But based on new information from the U.S. Bureau of Labor Statistics and provided by the DWD, Wisconsin gained 1,000 jobs in September, down 500 from previous estimates.

The more recent monthly totals, however, show more job losses.

Wisconsin’s economy shed 6,000 private-sector  jobs and a total of 7,500 nonfarm (including government positions) jobs  in October, according to seasonally adjusted data from BLS

Unemployment data is one of the easiest-to-understand signs of economic strength or weakness. As such, the statistics tend to be a hot-button issue in politics, with incumbents taking credit or assigning blame for the numbers, depending on whether the data indicates employment growth or decline. Likewise, the opposition party generally makes political hay with bad news on the employment front.

Gov. Scott Walker and his administration have been no exception. Happy to tout employment statistics when they show job gains, Walker nevertheless has criticized the monthly numbers (in unfavorable months) for being inaccurate, largely because they are based on a small survey of employers.

For the past several months, the administration has argued that the Quarterly Census of Employment and Wages is a much more accurate accounting of the jobs picture. It is, according to economists inside and outside the BLS.

The second-quarter numbers, for instance, were based on information from almost 96 percent of Wisconsin businesses, according to the DWD.

The BLS’ former commissioner, Keith Hall, has said the bureau’s method of measuring unemployment is “flawed.”

But, Hall added, “There’s no one best single indicator that tells you about the health of the labor market. You have to look at a number of things.”

– by Kirsten Adshead