Now that the Affordable Care Act has gone into effect, you may be able to see the ripple effect of the law from the way it has sparked changes in businesses’ hiring practices. So-called “Obamacare” has mandated that companies with more than 50 full-time employees offer their staff members affordable health care options, or else these businesses must fork over $2,000 per representative without coverage in excise taxes.
To avoid excessive financial burdens – whether it be from benefits costs or fines – a share of companies have resorted to contract recruiting and staffing practices. Rather than taking on full-time employees and being subjected to the ACA’s provisions, some businesses are looking to hire more contractors, meeting their rising manpower demands without incurring additional expenses due to health care reform. “I think you will see a greater reliance on contract recruitment agencies to staff for growth positions,” said John Rutledge, vice president at Assurance Agency. “In other words, as an employer would grow, and normally would add permanent employees, they will rely more on recruitment agencies to staff those positions,” he explained. This means that as the economy may continue growing, the positions created could be different than what some job seekers expected. Instead of full-time opportunities, contract and contract-to-hire jobs may be more common, as companies attempt to stay under the 50-employee threshold. Additionally, because companies have to spend significant sums of money to offer each full-time employee medical coverage, any professional they decide to hire has to be a safe bet. To ensure they are making a smart investment, a number of businesses are embracing contract recruiter account representatives for trial periods before converting new hires into direct hire, full time employees. You can already see these new hiring habits. The number of contracted interactive and digital professionals climbed to a record high in 2013, exceeding its 2000 peak by 16 percent. At the same time, the health care industry is participating in this staffing trend, as the demand for contract employees within this field has increased 28 percent since 2008 – another all-time high.
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