Biden vaccine mandate will have modest impact on economy -Goldman Sachs

WASHINGTON, Sept 13 (Reuters) - The Biden administration's new vaccine mandate here may apply to as few as 25 million people and perhaps prompt half of them to get inoculated over the next six months, Goldman Sachs economists estimated, projecting only a modest impact on U.S. employment.

Joe Biden’s executive order, issued last week to bolster tepid U.S. vaccination rates and insure a continued U.S. economic recovery, mandated vaccines for federal employees and the bulk of healthcare workers, and requires firms with more than 100 employees to put either vaccination or testing requirements in place.

All told it would, in theory, cover 100 million jobs here, or about two thirds of U.S. payroll employment.

But combining data on existing vaccination rates and the employment shares of the different jobs covered shows “the requirements will apply to about 25 million currently unvaccinated working individuals,” Goldman economists Joseph Briggs, Daan Struyven and Sid Bhushan estimate.

Those mandates might also lead some people to quit their jobs, find other work in smaller companies that do not have a mandate, or opt to undergo testing if it is available, they add.

Using a combination of survey data and shifting vaccination rates after a French mandate, they estimated that perhaps as few as 12 million people would be vaccinated as a result of the mandate - a 3.6% boost to the vaccinated share of Americans.

The United States, with just about 64% of its population here at least partially immunized, remains far short of the level needed to reach herd immunity and curb the spread of the coronavirus. Scientists are watching new variants of the virus as well.

Goldman Sachs economists predict that overall U.S. vaccination rates may hit 82% by the middle of next year after vaccines are approved for children under 12, a level they feel will see the economy more fully open and workers less hesitant to return to jobs.

But the mandate may result in lower employment in the near term, they said.

“We see some downside employment risk in the near term, as 7 million affected workers report that they will definitely not get the vaccine, and vaccine mandates imposed by health care providers earlier this summer caused some workers to leave their jobs,” the Goldman economists wrote.

Reporting by Howard Schneider; Editing by Heather Timmons and Lisa Shumaker