Due to inflation, funding won't cover adding a team member as planned for upcoming iterations. With tight budget and deadlines and an experienced cross-functional team, what should the project manager do first?

The best first step is to request the current team to analyze the work planned for the additional resource. This leverages the experienced cross-functional team's knowledge to identify if the work can be absorbed, re-prioritized, or if the initial estimate for the additional resource was truly essential. This approach aligns with agile principles of self-organizing teams and problem-solving, providing data for subsequent decisions. Asking business stakeholders to reduce features is a potential later step, but it's premature without understanding the team's capacity. Delaying hiring is not a solution to the immediate problem of unfunded work. Asking for a less experienced, cheaper team member might compromise quality or efficiency, and doesn't address the core issue of the work needing to be done.