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News

Jun 7, 2017

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Working Colorado: When part-time isn’t enough

by | Jun 7, 2017

Research and Policy Analysis

Colorado is currently enjoying a historically low unemployment rate. According to the Bureau of Labor Statistics, as of April 2017, the state has the lowest unemployment rate (2.3 percent) in the nation.

Unfortunately, the unemployment rate alone does not tell the complete labor-market story. Rarely do measures of “underemployment” garner much attention, but they could provide clues into why the sustained economic “recovery” doesn’t feel genuine or robust for many Coloradans.

One form of underemployment is “involuntary part-time employment” — that is, workers currently employed part-time who are both willing and able to work full-time yet unable to secure a full-time position due to slack business conditions, seasonal employment or other factors.

Involuntary part-time employment reached a high of nearly 25 percent of all part-time workers in Colorado at the height of the recession. The rate declined to 16.7 percent in 2016, mainly due to the state’s economy gaining momentum. Fewer workers are indicating that slack work or business conditions are the reason for their involuntarily part-time employment—a reason that is most associated with temporary cyclical shifts in the economy. But while the involuntary part-time employment rate has fallen, it is still slightly above the pre-recession level and higher than historical levels (see chart). Through the late 1990s, less than 10 percent of part-time workers wanted to work full-time.

So if the economy has picked up steam, and it’s clear that the Colorado economy has from the low unemployment rate, why do we still see an elevated rate of involuntary, part-time workers? Some economists argue that the rate remains relatively high because of both cyclical and structural changes to the economy. Structural shifts include practices such as reducing hours to avoid offering full-time workers benefits such as health insurance and taking advantage of lax regulations around “on-demand” scheduling of workers. When combined with a decrease in the supply of workers under the age of 25, these economic trends have led the hospitality, retail and food industries to rely on workers who would have preferred to work full-time schedules and older workers to fill the gaps. Without changes in employment policies, these structural shifts in the economy will continue.

An estimated 98,000 workers in Colorado wanted more hours than their part-time employment offered in 2016. As a share of employed workers, involuntary part-timers in Colorado have doubled since 2000. While shifting to more part-time workers may help employers keep labor costs down, workers who involuntarily work part-time experience problems outside of work.

Often part-time jobs are associated with inconsistent schedules which cause logistical headaches for workers, especially for parents trying to arrange child care. Fewer benefits and lower wages are associated more with the kinds of jobs held by involuntary part-timers than their voluntary counterparts. Since involuntary part-time work is rarely stable, nearly a third experience at least 13 weeks of unemployment annually. This is concerning because a 2012 study found that 25 percent of involuntary part-time workers lived below the federal poverty line versus 5 percent of full-time workers.

An economy that makes it harder for workers to work is not realizing its full potential. In addition to policies that promote job creation, state legislators ought to consider legislation that expands workers’ rights to request minimum and maximum hours and stable scheduling to put involuntary part-time workers on the path to self-sufficiency.

Among these considerations, it seems stable scheduling has emerged as the most popular. In California, state legislators considered Assembly Bill 5 this past year, referred to as the “Opportunity to Work Act,” which would have required an employer who employs more than 10 employees to extend more hours to all currently employed non-exempt part-time workers before hiring another employee. It has been postponed until 2018. This legislation took its inspiration from cities such as San Francisco, San Jose, and Seattle that have passed their own secure-scheduling measures — giving part-time employees in certain industries access to more hours.

In the absence of strong statewide labor protection around scheduling fairness, the New York City Council also recently passed local legislation that would protect fast-food and retail workers —  two industries that have increasingly relied on involuntary part-time workers to fulfill their labor needs –from having unfair notice of schedule changes, while providing stable scheduling and a path to full-time hours.

Initiatives like these would create a disincentive for employers to fill their labor needs with multiple part-time workers and counteract the structural shifts in the economy that have contributed to the rise in involuntary part-time work.

-Jesus Loayza

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Recent articles

CCLP testifies in support of TANF grant rule change

Apr 15, 2024

CCLP's Emeritus Advisor, Chaer Robert, provided written testimony in support of the CDHS rule on the COLA increase for TANF recipients. If the rule is adopted, the cost of living increase would go into effect on July 1, 2024.

CCLP’s legislative watch for April 5, 2024

Apr 5, 2024

For the 2024 legislative session, CCLP is keeping its eye on bills focused on expanding access to justice, removing administrative burden, preserving affordable communities, advocating for progressive tax and wage policies, and reducing health care costs.

HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

To maintain health and well-being, people of all ages need access to quality health care that improves outcomes and reduces costs for the community. Health First Colorado, the state's Medicaid program, is public health insurance for low-income Coloradans who qualify. The program is funded jointly by a federal-state partnership and is administered by the Colorado Department of Health Care Policy & Financing.

Benefits of the program include behavioral health, dental services, emergency care, family planning services, hospitalization, laboratory services, maternity care, newborn care, outpatient care, prescription drugs, preventive and wellness services, primary care and rehabilitative services.

In tandem with the Affordable Care Act, Colorado expanded Medicaid eligibility in 2013 - providing hundreds of thousands of adults with incomes less than 133% FPL with health insurance for the first time increasing the health and economic well-being of these Coloradans. Most of the money for newly eligible Medicaid clients has been covered by the federal government, which will gradually decrease its contribution to 90% by 2020.

Other populations eligible for Medicaid include children, who qualify with income up to 142% FPL, pregnant women with household income under 195% FPL, and adults with dependent children with household income under 68% FPL.

Some analyses indicate that Colorado's investment in Medicaid will pay off in the long run by reducing spending on programs for the uninsured.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

Hunger, though often invisible, affects everyone. It impacts people's physical, mental and emotional health and can be a culprit of obesity, depression, acute and chronic illnesses and other preventable medical conditions. Hunger also hinders education and productivity, not only stunting a child's overall well-being and academic achievement, but consuming an adult's ability to be a focused, industrious member of society. Even those who have never worried about having enough food experience the ripple effects of hunger, which seeps into our communities and erodes our state's economy.

Community resources like the Supplemental Nutrition Assistance Program (SNAP), formerly known as Food Stamps, exist to ensure that families and individuals can purchase groceries, with the average benefit being about $1.40 per meal, per person.

Funding for SNAP comes from the USDA, but the administrative costs are split between local, state, and federal governments. Yet, the lack of investment in a strong, effective SNAP program impedes Colorado's progress in becoming the healthiest state in the nation and providing a better, brighter future for all. Indeed, Colorado ranks 44th in the nation for access to SNAP and lost out on more than $261 million in grocery sales due to a large access gap in SNAP enrollment.

See the Food Assistance (SNAP) Benefit Calculator to get an estimate of your eligibility for food benefits.

FOOD SECURITY:
SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC)

Every child deserves the nutritional resources needed to get a healthy start on life both inside and outside the mother's womb. In particular, good nutrition and health care is critical for establishing a strong foundation that could affect a child's future physical and mental health, academic achievement and economic productivity. Likewise, the inability to access good nutrition and health care endangers the very integrity of that foundation.

The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides federal grants to states for supplemental foods, health care referrals, and nutrition information for low-income pregnant, breastfeeding and non-breastfeeding postpartum women and to infants and children up to age five who are found to be at nutritional risk.

Research has shown that WIC has played an important role in improving birth outcomes and containing health care costs, resulting in longer pregnancies, fewer infant deaths, a greater likelihood of receiving prenatal care, improved infant-feeding practices, and immunization rates

Financial Security:
Colorado Works

In building a foundation for self-sufficiency, some Colorado families need some extra tools to ensure they can weather challenging financial circumstances and obtain basic resources to help them and their communities reach their potential.

Colorado Works is Colorado's Temporary Assistance for Needy Families (TANF) program and provides public assistance to families in need. The Colorado Works program is designed to assist participants in becoming self-sufficient by strengthening the economic and social stability of families. The program provides monthly cash assistance and support services to eligible Colorado families.

The program is primarily funded by a federal block grant to the state. Counties also contribute about 20% of the cost.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

Child care is a must for working families. Along with ensuring that parents can work or obtain job skills training to improve their families' economic security, studies show that quality child care improves children's academic performance, career development and health outcomes.

Yet despite these proven benefits, low-income families often struggle with the cost of child care. Colorado ranks among the top 10 most expensive states in the country for center-based child care. For families with an infant, full-time enrollment at a child care center cost an average of $15,140 a year-or about three-quarters of the total income of a family of three living at the Federal Poverty Level (FPL).

The Colorado Child Care Assistance Program (CCCAP) provides child care assistance to parents who are working, searching for employment or participating in training, and parents who are enrolled in the Colorado Works Program and need child care services to support their efforts toward self-sufficiency. Most of the money for CCCAP comes from the federal Child Care and Development Fund. Each county can set their own income eligibility limit as long as it is at or above 165% of the federal poverty level and does not exceed 85% of area median income.

Unfortunately, while the need is growing, only an estimated one-quarter of all eligible children in the state are served by CCCAP. Low reimbursement rates have also resulted in fewer providers willing to accept CCCAP subsidies.