Members of Congress often talk about strengthening the economy, creating good jobs, and supporting working families – but a reading of the House’s “One Big Beautiful” Reconciliation bill tells a different story.
This bill marries the hopeful rhetoric of opportunity with the harsh reality of disinvestment. Rather than investing in the training, partnerships, and support systems that workers and businesses rely on – the legislation proposes deep cuts to systems that help students pay for college, health care, food assistance, as well as sector partnerships that help businesses build a talent pipeline for in-demand jobs.
It’s clear Congress recognizes the importance of skills. The bill takes meaningful steps toward expanding access to short term training through Pell Grants. It’s our network’s advocacy that has made this proposal a broadly supported reform. Unfortunately, it’s being used as a spoonful of sugar to help advance a bill that otherwise restricts access to education for the very students who need support the most.
The bill’s proponents argue the cuts are in the name of fiscal responsibility. And there are components of these systems that can be modernized, but not in this manner. Working people will foot the bill by sacrificing opportunity and economic mobility to “offset” massive tax credits for the highest earners.
At what cost? That’s the question skills advocates are asking as lawmakers move to gut investments in jobs, education, public health, and economic mobility—while handing out trillions in tax breaks.
Read NSC’s previous blog on how the bill impacts programs at the departments of Labor and Education.
To offset the cost of extending the expiring provisions of the 2017 Tax Cuts and Jobs Act, new proposals like No Tax on Tips and Overtime and a $4 trillion debt limit increase, House Republicans proposed cuts from programs under several committees:
The Senate is now tasked with drafting its own bill and proposing smaller cuts – but the House bill has established a clear set of priorities, and a troubling vision of how federal resources should be allocated. It’s likely the Senate’s bill will differ in significant ways, but the House bill sets the direction for the debate and the negotiations that will be needed to reconcile the two bills.
In the meantime, skills advocates are already fighting back. Based on the priorities of our network, NSC recently organized more than 100 organizations and businesses to urge Congress to protect energy and infrastructure investments that support millions of good-paying jobs, modernize the Work Opportunity Tax Credit (WOTC) to support work-based learning, preserve access to essential supports like SNAP, Medicaid, and TANF, expand Pell Grant access to include short-term, high-quality training programs, and strengthen the Child Tax Credit and Earned Income Tax Credit to support working families.
At the same time, the legislation proposes eliminating many of the tax credits that were driving energy projects and related hiring and skills training programs. Credits for purchasing electric vehicles are eliminated, a move that is likely to reduce job growth in the EV manufacturing industry.
Tax credits that drive clean energy projects are also on the chopping block:
These drastic rollbacks would disrupt projects already underway. Many of these initiatives have already begun with the expectation of stable federal funding and tax incentives. Rescinding support threatens projects, job losses, and wasted taxpayer dollars, while leaving communities without the skilled workforce needed to support the energy sector.
Basic needs are workforce needs. Wrap around supports are a key determinant of a person’s success in training programs and on the job. When people have their basic needs met, they are more likely to complete education and training, maintain steady employment, and move into jobs that offer long-term economic mobility. But the House bill would make these supports harder to access – particularly for immigrants, low-income people, and people facing economic hardship.
The reconciliation proposal would significantly restrict access to the Children’s Health Insurance Program (CHIP), Medicaid, and Medicare by tightening eligibility and imposing new requirements. For example:
In addition to tightening eligibility, the bill imposes new work requirements for Medicaid and SNAP recipients despite consistent evidence that such requirements are ineffective at reducing poverty or promoting stable employment. These provisions
These changes will likely result in coverage losses for workers who face barriers like inconsistent hours, caregiving responsibilities, or limited job availability.
The bill also shifts more of the financial burden onto families and states. For example, new Medicaid cost-sharing rules would:
Taken together, these changes would erect significant administrative and financial barriers to enrollment and retention, making it harder for people and families (especially those balancing work, training, and caregiving) to access the supports they need to stay healthy, pursue opportunity, and achieve long-term stability. And the bill misses the opportunity to realize even more savings by supporting people’s access to good jobs.
Tax policy plays a critical role in helping people support their families and helping businesses drive growth. Well-designed tax credits can ease financial challenges, mitigate barriers to employment and training opportunities, and incentivize employers to invest in skills training. While the reconciliation package includes some changes to tax credits that our network follows closely, it falls short of making the kinds of changes that will truly expand access to training and support families.
The Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) are proven tools for helping low-wage workers support their families, pursue skills training, and move toward financial independence. NSC and our partners have long supported expanding these credits which help people in low-paying jobs cover basic needs such as child care, transportation, and housing while they work to build new skills and access better employment.
The reconciliation package does expand the CTC—raising the credit from $2,000 to $2,500 between 2025 and 2028 and indexing it to inflation thereafter. Because of changes, though, the expansion will not benefit workers earning the lowest wages.
At the same time, the bill makes it more difficult to access the EITC. Beginning in 2028, families must obtain a specific EITC certificate for each eligible child to claim the credit, creating new administrative barriers that will likely hinder access to the credit.
CTC and EITC recipients often use these credits to fund transportation and child care which enjoy strong public support. 82% of all voters support increased funding for support services like child care and transportation to help people complete skills training, including over three-quarters of Republican and Independent voters.
The legislation misses an opportunity to strengthen tax incentives that encourage employers to offer on-the-job training to workers. For example, the Work Opportunity Tax Credit (WOTC)could be expanded to align hiring incentives with workforce development goals. Currently, WOTC provides a credit to employers who hire people from certain demographics, such as veterans or those with low incomes, but these positions often offer limited opportunities for career advancement.
A better approach would be to expand WOTC to offer a stronger credit for employers offer apprenticeships and on-the-job training. That kind of change would create more pathways to sustainable employment and help businesses address persistent talent shortages. Congressman Horsford, who is leading this proposal, emphasized the need for advocacy during the recent Skills Summit. While this proposal was not included in the reconciliation package, a clear interest in tax incentive proposals that support workers and employers from Republicans in Congress could help propel this proposal for inclusion in year-end package.
As we outlined in our previous blog on the Education and Workforce Committee sections of the bill, it is encouraging to see an expansion of Pell Grants to short-term, career-focused training programs, a long-standing priority for our network. However, the bill simultaneously undermines access to affordable education – especially for low-income learners and many immigrants. The bill includes significant restrictions on federal student loans, measures that could make it harder for people to access or return to education throughout their careers. Expanded Pell grant eligibility should not come at the expense of higher education access. In today’s economy workers often need to upskill or reskill multiple times. Policy must support that, rather than create new barriers.
The bill would also:
While not included in the priorities most elevated by our partners, the bill proposes some additional changs with impacts on workforce and skills:
Republicans in the House advanced the package without bipartisan support; and the bill has narrow margins in both chambers. At the same time, internal divisions within the party are creating roadblocks. Just this week, movement stalled as some conservative members pushed for deeper and faster cuts to Inflation Reduction Act investments and key safety net programs which conflict with the priorities of more moderate Republicans.
The bill is unlikely to advance through the Senate in its current form, where Republican leaders will need to navigate a different set of priorities. This ongoing debate means there is still time to advocate.
That means there’s still time to act. Sign your organization on to our letter — we are adding new supporters on a rolling basis as the Senate begins its work.
But the stakes are clear: we can’t build economic prosperity by tearing down the very systems that support workers, businesses, and our economy. NSC, with you, will keep pushing for a different approach —one matches bold rhetoric with real investments in workers, training, and economic mobility.
