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Associations urge federal infrastructure investment

At separate events in October, both the Associated General Contractors of America (AGC) and the American Road & Transportation Builders Association (ARTBA) urged members of the U.S. House of Representatives to use infrastructure investments as part of any economic stimulus plan. Boosting highway, rail, airport, and water infrastructure construction will quickly create jobs and spur economic recovery, the groups said.

During an economic forum with leading economists, AGC’s CEO Stephen E. Sandherr told House Democrats that "a significant boost to construction in the form of increased infrastructure investment will create jobs and increase the quality of life for millions of Americans who rely daily on our nation’s infrastructure, from roads and bridges, to water systems and schools. We congratulate the House on passage of a stimulus appropriations bill prior to adjournment on Oct. 3, and we urge the Senators, who rejected a stimulus bill on Sept. 26, to reconsider."

In late September, the House passed an economic stimulus bill (264-158) that included approximately $34 billion for infrastructure investment, including $12.8 billion for the federal-aid highway program; $3.6 billion for transit; $600 million for airport capital improvement projects; $7.5 billion for water infrastructure; $5 billion for the U.S. Army Corps of Engineers; $3 billion for public school reconstruction; $500 million for Amtrak; and $1 billion for public housing construction. A similar bill in the Senate failed on a procedural vote (52-42).

AGC said that an estimated $100 billion of new infrastructure projects have been delayed because of the reduced credit market. Coupled with construction materials cost inflation, fewer contracts are going out to bid, resulting in 52,000 lost construction jobs and further deterioration of national infrastructure, the group said.

In testimony before the House Transportation & Infrastructure Committee, William Buechner, Ph.D., vice president of economics and research for ARTBA, noted that "U.S. construction workers have, so far, borne the brunt of the current economic crisis."

Noting that the unemployment rate in the construction industry during September was 9.9 percent—almost four percentage points higher than that for the economy as a whole—Buechner said ARTBA’s quarterly survey of transportation construction contractors found 60 percent reported they had fewer employees in the third quarter of this year than during the same quarter in 2007.

"Our industry has the capacity to take on additional work immediately. Our latest market conditions survey found only 3 percent of respondents operating at full capacity during the third quarter. Thirty six percent report they are now operating at 75 percent of capacity or less. This is up from 27 percent in the second quarter and the highest in the history of our survey," Buechner said.

Buechner underscored the industry’s ability to immediately address transportation needs and create jobs. "With a properly structured program … thousands of transportation construction projects across the nation are ready to go. This includes work like milling, resurfacing and overlays, safety striping, guardrail and sound wall installations, signage repair and replacement, and investments in new lighting and safety appurtenances. Bridge investments could also play a large role in an economic recovery and jobs program. Bridge deck repairs, sealing, resurfacing, and preservation work can be put into motion quickly—so could accelerated bridge inspection, scraping, and painting programs."

According to AGC’s Sandherr, "Construction has always been an engine of economic stimulus and can play that role once again. Increases in infrastructure investment can be quickly put into play and will have a direct, immediate, and dramatic impact on the economy."