Many workers may opt to work less to retain their eligibility for Medicaid or federal subsidies under Obamacare, a new report has found.
The Affordable Care Act could reduce the labor force by the equivalent of 2.5 million workers in 2024, according to the non-partisan Congressional Budget Office's annual outlook.
That doesn't mean employers will start swinging the ax or even that that many jobs will be lost, CBO says. Rather, more people will likely opt to reduce their hours, or leave the workforce entirely, so they stay under the income caps for Medicaid and federal subsidies.
"The estimated reduction stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in businesses' demand for labor," the report says. Therefore, it will more likely show up as a decline in share of the population participating in the labor forceand in hours worked, rather than in spikes in unemployment or underemployment.