The Inflation Reduction Act of 2022 is the most significant economic and clean energy jobs program the United States has ever initiated. To improve overall understanding of whether the new law has been effective in achieving its economic policy goals, the Washington Center for Equitable Growth is engaging with policymakers and academics to discuss evaluation and research opportunities that have emerged since its implementation. Through the release of our Request for Proposals: The economic effects of the Inflation Reduction Act, our goal is to stimulate new research on the law’s impact on local and regional labor markets, job creation, innovation, and investment.

The questions and answers outlined below serve as a resource for academics seeking to sharpen their research questions on how the Inflation Reduction Act is shaping distributional economic outcomes on inequality and growth.

What key provisions of the Inflation Reduction Act are most important for researchers seeking to explore its effectiveness in revitalizing local labor markets?

The Inflation Reduction Act was initiated by the Biden administration to respond to decades of U.S. economic and trade policies that resulted in hollowed-out communities, brittle global supply chains, and the consequences of these baleful economic dynamics on workers and their families amid rising income and wealth inequality. The law marked a shift toward economic and clean energy policymaking that deploys public investments to create jobs in local economies. Initial evidence suggests that IRA investments have generated more than 400,000 new clean energy jobs across 48 states and Puerto Rico, while other evidence suggests that if fully implemented, the law’s energy tax credits could lead to 1.7 million new U.S. jobs by 2030.

Job creation is a key economic aim of the Inflation Reduction Act, but the law is specifically designed to create good jobs, which have been shown to benefit both workers and businesses. Many of the law’s policy levers targeting the creation of good jobs offer strong opportunities for policy evaluation.

More research is needed to understand the effects of IRA investments on the quantity and characteristics of jobs created or displaced, as well as the law’s effects on local and regional labor markets, including whether there are notable differences across places. More specifically, are there regional characteristics associated with different outcomes?

Read the full article about the Inflation Reduction Act's impacts at Equitable Growth.