Congress may alter the scope of the American Jobs Plan, but the plan still has the potential to significantly impact a variety of industries.
The Plan
After passing a historically large stimulus bill, the Biden administration released the American Jobs Plan in late March 2021 to lay out its vision for an infrastructure investment plan. The plan contains a total of $2.0 trillion in investments in upgrading US infrastructure, and if passed, will likely affect a wide variety of industries across the overall economy. While this plan will likely be modified by Congress, the proposal provides insight into the administration’s priorities for infrastructure spending.
“Hard” infrastructure
The largest chunk of spending in Biden’s plan is $621.0 billion on what could be considered “hard infrastructure.” The plan sets out a goal to modernize 20,000 miles of highway, roads and main streets, which would likely provide significant new business for companies in the Road and Highway Construction industry. Additionally, companies in the Bridge and Elevated Highway Construction industry will likely benefit from funding in the plan to repair bridges across the United States.
All in on electric vehicles
The American Jobs Act also calls for investing $174.0 billion into the electric vehicle market, which may provide a significant boost for companies in the Hybrid and Electric Vehicle Manufacturing industry. The plan calls for the electrification of 20.0% of the US school bus fleet, along with electrification of the entire US federal fleet, including the US Postal Service. The plan also calls for building out a network of 500,000 electric vehicle chargers by 2030, which may make electric vehicles more appealing to prospective consumers.
“Soft” infrastructure
Some of the priorities in the American Jobs Plan stretch the traditional definition of infrastructure, falling more under the category of “soft infrastructure”, which are nonphysical assets that help maintain the health, economic and social standards of the United States.
For example, the plan includes an expansion of long-term care under Medicaid and increasing access to home and community-based care services. While they are not typically considered infrastructure in the traditional sense, operators in the Home Care Providers industry would likely experience a robust increase in demand from the provisions of the American Jobs Plan.
What could be
The broad-based approach to infrastructure spending would likely enable companies in various industries to potentially experience a significant increase in demand for their services from this plan. While companies will likely need to closely monitor the economic effects of the significant amount of stimulus spending that the administration is proposing, such as a potential rise in inflation moving forward, they also may stand to benefit from a significant increase in federal spending in a variety of industries and sectors. Nevertheless, the final shape of this plan will likely change somewhat as it is debated by the US Congress.
