Rebuilding our muscle

American manufacturers pay more than twice as much per hour for health benefits as the manufacturers in countries we regularly trade with, according to a new report by the New America Foundation that found for every $2.38 an hour paid for benefits by US manufacturers, others pay about $0.96. It’s a losing proposition all around that:

  1. Makes our products more expensive — read: less competitive. (ie. an American-made car costs $1,500 more due to health costs versus $900 more by foreign competitors.
  2. Results in American businesses trying to ratchet down what they pay in health care costs, and resulting in crappier coverage for their workers. (for more money, I might add)
  3. Results in jobs going overseas — like Ford going to Canada as reported earlier this week.

The report runs through a litany of interesting stats, including:

  • In 1960, health benefits were only 1.2% of payroll. Now, it’s more like 9.9% (averaged across all businesses, including those that *don’t* provide coverage).
  • Since 2000, fewer employers are offering coverage (from 69% to 60%). But for workers that *do* get coverage on the job, it’s costing more — 102% more (from $135 to $273 monthly premium).

It also acknowledges that not all costs can be shifted to workers, either in higher premiums and out-of-pocket costs or lost wages, because it would affect a business’ ability to be competitive in hiring good quality employees — something all businesses must grapple with in order to stay competitive. And that the cost of health care can’t depress wages — particularly for those already making minimum wage ($5.85 or $8 in CA), or in cases where a labor contract acts as a backstop.

Health Access California promotes quality, affordable health care for all Californians.

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