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Obamacare may pad millennials’ pay

By Crissinda Ponder · Bankrate.com
Wednesday, May 14, 2014
Posted: 6 am ET

Americans in their late teens and early 20s have been breathing a little easier since the Affordable Care Act allowed them to latch onto their parents' health insurance for a while longer, and the extra time they have to enjoy this benefit may also mean extra money.

A© wavebreakmedia/Shutterstock.comnalyzing data from the U.S. Census and its American Community Survey, a new study suggests that young adults who are now able to stay on a parent's plan until the age of 26 may be able to seek jobs that don't offer insurance but do pay higher wages.

Increases of at least 1.5 percent

Marcus Dillender, an economist at the Upjohn Institute for Employment Research and the author of the study, estimates that Obamacare may boost young people's wages anywhere from 1.5 percent to 6.8 percent. But that's a rough prediction with caveats, he cautions.

"It may take several years before we see any increases from the ACA. Also, a lot of other things are changing along with the ACA," he says.

Additionally, the study finds that young adults who can take advantage of extended health coverage through Mom or Dad are likely to pursue more education.

"The need for insurance through an employer appears to keep a small portion of older young adults (ages 23 and 24) from going to school," Dillender explains.

Higher wages later on, too

When a young person doesn't need work-based coverage and can stay in college or go on to grad school, that also can lead to better paychecks.

"Increased wages coming from increases in education would persist even after people were no longer eligible for insurance through their parents' employers," he says.

Just turned 26 and shopping for health insurance? If you're strapped for cash, you might consider an Obamacare catastrophic plan.

Follow me on Twitter @CrissiPonder.

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1 Comment
Arron Hall
May 14, 2014 at 1:07 pm

That’s a smart decision take by youngsters who are now able to stay on a parent's plan until the age of 26 may be able to seek jobs that don't offer insurance but do pay higher wages. Even our company also stop hire the potential employees due to employer mandate but after watching this video on you tube www .youtube .com/watch?v=0yo2TB26SLQ they got the way to turn this nightmare into number of opportunities. Now the hiring is on again.

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