A recent report from the Associated General Contractors of America (AGC) indicates that the one-year-old stimulus bill had a greater effect on construction jobs than first thought. AGC's analysis of newly released federal data showed that stimulus-funded infrastructure projects are saving and creating more direct construction jobs than earlier estimates indicated, and that more contractors are likely to perform stimulus-funded work in 2010 as work begins on the non-transportation projects originally accounted for in the legislation.
"The stimulus is one of the very few bright spots in the construction industry experienced last year and is one of the few hopes keeping it going in 2010," said AGC Chief Economist Ken Simonson. "The stimulus is saving construction jobs, driving demand for new equipment and delivering better and more efficient infrastructure for our economy."
The stimulus bill, officially dubbed the American Recovery and Reinvestment Act (ARRA), was signed into law on February 17, 2009. The bill has been controversial since its enactment due to both its $787 billion price tag and critical observations that the legislation has not had the intended effect of creating jobs and stabilizing the economy. The AGC's analysis, however, rebuffs the latter point, showing that large positive effects have come directly from ARRA money and investments.
In the last 12 months, federal reports indicate that $20.6 billion worth of stimulus highway projects have begun, saving or creating nearly 280,000 direct construction jobs, amounting to 15,000 jobs per billion dollars invested. Pre-stimulus estimates had suggested that every billion dollars invested would create only 9,700 jobs.
Despite its positive influence on the sector, Simonson noted that overall declines in construction activity would still overshadow any positive effects the stimulus might have. "The stimulus will keep a bad situation from deteriorating further," he said. "That may or may not make for great headlines, but it is welcome news for construction workers anxious to continue receiving paychecks."
Other positive effects of the stimulus listed by Simonson included the fact that heavy and civil engineering construction employment remained stable in January 2010, even as total construction employment declined by 75,000. Additionally, highway and road construction, which received the bulk of stimulus funds in 2009, was one of the only areas to see an increase in spending in 2009 even as total construction spending fell by $100 billion over the same period.
Jacob Barron, NACM staff writer