If you know anyone who works in the service industry, you should be very familiar with the problem of hour volatility. When work hours aren’t set, worker schedules can vary greatly from week to week and from month to month. This can make a steady stream of income difficult to achieve for service workers. It can also affect eligibility for public benefits.
The Ohio Department of Medicaid is currently working with the federal government to implement work requirements for Ohio’s “Medicaid expansion” population–the 760,000 Ohio residents who receive health insurance through the Kasich Administration-era expansion of Medicaid. These work requirements would apply to households at 138% of the federal poverty level and below.
Low-income households tend to be headed by people who work in the service industry. My colleague Michael Hartnett estimates that cooks and waiters are the second- and fifth-most common jobs among people in the bottom 20% of income in Ohio.
A new analysis by Brookings Institution researchers looks at how the volatility of hours for service workers will impact eligibility for benefits like Medicaid and SNAP.
One of the things they look at is the mental model that undergirds the current work requirement system. In 1976, only 26% of low-income employees worked in the service sector. By 2024, that number had risen to 38%. This means that 50 years ago, the contours of an unsteady sector had less of an impact on month-to-month hours than it does today.
These researchers used data from the Survey of Income and Program Participation to estimate that 64% of service workers worked less than 80 hours in at least one month in 2022. A third (34%) of workers who work an average of 80 hours a month had at least one month that year that they worked less than 80 hours. That means that a monthly work requirement of 80 hours would have disqualified a third of service workers at some point during 2022 from benefits like Medicaid or SNAP.
The researchers also find these volatile work hours are largely outside of the control of the workers. According to their analysis, three-quarters of service workers with irregular schedules say their schedules are at the request of their employers, not their own. This is also a high rate among non-service workers, where over 3 in 5 low-income workers with irregular schedules are conforming to employer requirements.
So what does this mean? It means tens of thousands of low-income workers in Ohio could lose their health insurance because of work hour volatility out of their control.
The labor market has changed a lot over the past fifty years, especially for low-income workers.
This has led to less certainty about hours, which makes thresholds like monthly hours not as effective for gauging whether people are participating in the labor force. There are a lot of reasons to be worried about work requirements. The fact that working people will lose health insurance because lack of control over work hours is just another one to add to the list.
This commentary first appeared in the Ohio Capital Journal.