The ACA will tend to reduce [workforce] participation, with the largest impact stemming from new subsidies that reduce the cost of health insurance purchased through exchanges. Specifically, by providing subsidies that decline with rising income (and increase with falling income) and by making some people financially better off, the ACA will create an incentive for some people to choose to work less. . . . The estimated reduction stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in business’ demand for labor, so it will appear almost entirely as a reduction in labor force participation and in hours worked relative to what have occurred otherwise rather than as an increase in unemployment (that is, more workers seeking, but not finding jobs) or underemployment (such as part-time workers who would prefer to work more hours per week).Matthew Yglesias explains the effect like this:
John is 59, has had a good career as a mechanical engineer, has saved pretty diligently his whole life, and also has a chronic heart condition. He's got the cash to retire early, but he's not yet eligible for Medicare. So he needs to keep working more than he wants to for a few more years. Or at least he would have if not for the Affordable Care Act, which makes it feasible for him to buy insurance on the private market and get a jump start on his fishing plans. . . . Obamacare will kill jobs in the same way that Social Security kills jobs. By making it easier for people in certain circumstances to get by without a job.Whether you think that is a good thing or a bad thing is a matter of taste, but it is a very different matter from "Obamacare kills 2 million jobs."