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Employer Health Benefit Costs and Demand for Part-Time Labor

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  • Jennifer Feenstra Schultz
  • David Doorn

Abstract

The link between rising employer costs for health insurance benefits and demand for part-time workers is investigated using non-public data from the Medical Expenditure Panel Survey- Insurance Component (MEPS-IC). The MEPS-IC is a nationally representative, annual establishment survey from the Agency for Healthcare Research and Quality (AHRQ). Pooling the establishment level data from the MEPS-IC from 1996-2004 and matching with the Longitudinal Business Database and supplemental economic data from the Bureau of Labor Statistics, a reduced form model of the percent of total FTE employees working part-time is estimated. This is modeled as a function of the employer health insurance contribution, establishment characteristics, and state-level economic indicators. To account for potential endogeneity, health insurance expenditures are estimated using instrumental variables (IVs). The unit of analysis is establishments that offer health insurance to full-time employees but not part time employees. Conditional on establishments offering health insurance to full-time employees, a 1 percent increase in employer health insurance contributions results in a 3.7 percent increase in part-time employees working at establishments in the U.S.

Suggested Citation

  • Jennifer Feenstra Schultz & David Doorn, 2009. "Employer Health Benefit Costs and Demand for Part-Time Labor," Working Papers 09-08, Center for Economic Studies, U.S. Census Bureau.
    • Handle: RePEc:cen:wpaper:09-08
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    File URL: https://www2.census.gov/ces/wp/2009/CES-WP-09-08.pdf
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    References listed on IDEAS

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    Cited by:

    1. Marcus Dillender & Carolyn J. Heinrich & Susan Houseman, 2022. "Effects of the Affordable Care Act on Part-Time Employment: Early Evidence," Journal of Human Resources, University of Wisconsin Press, vol. 57(4), pages 1394-1423.
    2. Dillender, Marcus O. & Heinrich, Carolyn J. & Houseman, Susan N., 2016. "Health insurance reform and part-time work: Evidence from Massachusetts," Labour Economics, Elsevier, vol. 43(C), pages 151-158.

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    Keywords

    employer health insurance costs; labor demand; part-time employment;
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