Cutting the Reconciliation Bill to $1.5 Trillion Would Support Nearly 2 Million Fewer Jobs per Year

Nearly 2 million fewer jobs per year would be supported if the budget reconciliation package is cut from $3.5 trillion to $1.5 trillion, according to new research from EPI visiting economist Adam S. Hersh.

Every state and Washington, D.C. would see fewer jobs supported under a $1.5 trillion plan--as Senator Joe Manchin (D-WV) has proposed--than the Build Back Better agenda, including:

• West Virginia, which would see 9,880 fewer jobs annually under Manchin's plan, equivalent to 1.33% of the state's overall employment. West Virginia would be no better off in terms of jobs in fossil fuel industries, but would see 900 fewer manufacturing jobs, 400 fewer construction jobs, and 3,800 fewer health care and social assistance jobs.
• Arizona, which would see 35,564 fewer jobs per year, equal to 1.17% of state employment. This would include 2,500 fewer manufacturing jobs, 1,600 fewer construction jobs, and 11,400 fewer health care and social assistance jobs. Senator Kyrsten Sinema (D-AZ) has objected to the $3.5 trillion price tag in the reconciliation package.

"The Build Back Better agenda would make critical investments to deliver relief to financially strained households, raise productivity, and dampen inflation pressures to enhance America's long-term economic growth prospects," said Hersh. "Further reducing the scale and scope of the budget reconciliation package unequivocally means the legislation will support far fewer jobs and deliver fewer benefits to lift up working families and boost the economy as a whole. Senators Joe Manchin and Kyrsten Sinema's efforts to scale back Build Back Better can only leave working families worse off and America's economy less resilient to the challenges we face now and in the future."

A recent EPI report showed that the Build Back Better agenda--combining the Bipartisan Infrastructure Framework and the proposed $3.5 trillion budget reconciliation package--would support more than 4 million jobs annually. If the reconciliation package is reduced to $1.5 trillion, 1.9 million fewer jobs would be supported.

The $2 trillion gap left by Sen. Manchin's proposal cuts far deeper than any of the policy specifics he proposes eliminating, according to Hersh. Even if Sen. Manchin succeeded in eliminating all climate-related funding in the Build Back Better agenda budget resolution, his plan would still fall nearly $1.8 trillion short. Thus, the analysis assumes that hewing to Sen. Manchin's demands would mean a proportional cut across all of the Build Back Better agenda's individual initiatives.