Identification of Job Lock and Inefficient Labor Market Mobility

2019 ◽  
Vol 86 (2) ◽  
pp. 530-547
Author(s):  
Tim Bersak
Keyword(s):  
Author(s):  
Gregory Colman ◽  
Dhaval Dave ◽  
Otto Lenhart

Health insurance depends on labor market activity more in the U.S. than in any other high-income country. A majority of the population are insured through an employer (known as employer-sponsored insurance or ESI), benefiting from the risk pooling and economies of scale available to group insurance plans. Some workers may therefore be reluctant to leave a job for fear of losing such low-cost insurance, a tendency known as “job lock,” or may switch jobs or work more hours merely to obtain it, known as “job push.” Others obtain insurance through government programs for which eligibility depends on income. They too may adapt their work effort to remain eligible for insurance. Those without access to ESI or who are too young or earn too much to qualify for public coverage (Medicare and Medicaid) can buy insurance only in the individual or nongroup market, where prices are high and variable. Most studies using data from before the passage of the Patient Protection and Affordable Care Act (ACA) in 2010 support the prediction that ESI reduced job mobility, labor-force participation, retirement, and self-employment prior to the ACA, but find little effect on the labor supply of public insurance. The ACA profoundly changed the health insurance market in the U.S., removing restrictions on obtaining insurance from new employers or on the individual market and expanding Medicaid eligibility to previously ineligible adults. Research on the ACA, however, has not found substantial labor supply effects. These results may reflect that the reforms to the individual market mainly affected those who were previously uninsured rather than workers with ESI, that the theoretical labor market effects of expansions in public coverage are ambiguous, and that the effect would be found only among the relatively small number on the fringes of eligibility.


2016 ◽  
Vol 46 (2) ◽  
pp. 301-324 ◽  
Author(s):  
Kevin Callison ◽  
Paul Sicilian

A greater level of government involvement in the financing of health care is generally viewed unfavorably by organizations monitoring economic freedom. However, increased government provision of health insurance could be associated with improved economic freedom through enhanced labor market mobility. For example, job-lock alleviation accompanying a public insurance expansion could lead to increased innovation or a higher likelihood of self-employment. In this article, we use the Affordable Care Act (ACA)’s recent Medicaid expansions to examine the effect of an increase in public health insurance provision on labor market outcomes by gender and race/ethnicity. Our results lend support to the notion that state Medicaid expansions are associated with improved labor market autonomy for white men and white women; however, we find mixed results for black and Hispanic men and women. Notably, our findings cast doubt on earlier claims that the ACA would lead to large reductions in labor force participation and employment.


ILR Review ◽  
1994 ◽  
Vol 48 (1) ◽  
pp. 68-85 ◽  
Author(s):  
Alan C. Monheit ◽  
Philip F. Cooper

It is widely hypothesized that health insurance deters job mobility because of imperfections in the labor and health insurance markets. This paper describes the nature of the welfare loss attributable to such “job-lock” and reviews several studies that empirically test the job-lock hypothesis. The authors find that estimates of the magnitude and importance of job-lock vary. Studies that support the job-lock hypothesis typically report a 20% to 40% reduction in mobility rates, depending on worker marital status and gender. Their own estimates suggest that although job-lock is present in the labor market, the proportion of workers affected and the magnitude of the welfare loss are less than generally supposed.


1982 ◽  
Vol 27 (5) ◽  
pp. 368-368
Author(s):  
Lois F. Copperman ◽  
Donna Stuteville
Keyword(s):  

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