President Obama chose Labor Day as a backdrop for yet another executive order. This time, he made it official that government contractors must provide paid sick leave for all workers. The administration will also push ahead the so-called Healthy Family Act to receive the same benefit to 44 million additional working Americans.
Perhaps this sounds good and even caring on paper, but it’s another example of government meddling that has already erased all the norms of the business cycle and post-recession recoveries. Forcing businesses with more than 15 employees to give paid sick leave benefits would crush so many small businesses. However, this administration believes business is there to be the honey pot of workers.
It’s the same notion that’s ushered in a higher minimum wage around the nation. There are mounds of evidence that it’s backfiring.
Seattle saw its biggest hit to employment among restaurant workers since 2009, and Los Angeles hotel workers are dropping like flies.
A higher minimum wage, Obamacare work definitions, and now paid sick leave are going to leave a scorched earth swathing through the lower end of the jobs market. Last month, the number of Americans who work part-time due to the economy surged from 158,000 to nearly 6.2 million.
Happy belated Labor Day!
The Market
Even though the market was down on Friday from yet another disappointing session, the Dow now appears to be putting in serious support north of 16,000. If it fails, we have to consider the serious possibility of the index retesting 15,666.
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