Health care mandates put jobs at risk in franchising.

Author:Caldeira, Stephen J.

Last month in Washington, D.C., 500 franchise business leaders came to Capitol Hill to become lobbyists for a day on issues such as health care, access to credit and tax reform. Throughout 200 meetings with members of Congress and their staffs, the franchise industry's message was heard loud and clear-franchising creates jobs!

Attendees also focused on several specific policy matters that will have major ramifications for the continued growth of the franchise industry. One of these is the health care law, specifically the employer mandate provision. Thanks to a new study commissioned by the IFA, in partnership with the Hudson Institute, IFA and our members have presented compelling, real world data to provide policymakers showing the true impact this harmful mandate will have on franchise businesses.

The report shows that mandates within the health care law will endanger the jobs of 3.2 million full-time employees at tens of thousands of franchise businesses. These mandates will force franchise small-business owners to choose between reducing the number of full-time employees or downsizing their businesses or both-none of which is a prescription for economic recovery.

Our industry, responsible for creating one out of every eight new jobs, can play an important role in lifting the U.S. economy and getting those who most need work back on the payrolls. Thanks to such a diverse range of industries that are using the franchise model to grow, such as restaurants, hotels, retail and service businesses, employers in franchising offer an entry point into the job market for lower-skilled workers, enabling them to put their foot on the first rung of the career ladder or even become a franchise owner.

These workers have some of the highest unemployment rates in America. Adults without high school diplomas face an unemployment rate of 14.3 percent, more than three times as high as rates for college graduates and well above the national average of 9.1 percent. The unemployment rate for teens, another lower-skilled group, is 25 percent.

One stark reality of the Hudson study shows the new penalties on franchise small businesses will close the door on these workers at a time when economic opportunity is scarce. The unemployment rate is still hovering...

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