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January 15, 2010

Recovery Act Has Created or Saved <br>1.5 to 2 Million Jobs, Administration Reports 

The Obama administration issued a report Tuesday stating the American Recovery and Reinvestment Act has saved or created 1.5 million to 2 million jobs in its first 11 months of spending.

These latest figures came from the White House Council of Economic Advisers. Although the nation's unemployment rate remains at 10 percent and the economy lost 85,000 net jobs last month, the administration contends the economy would not be entering a recovery if it were not for the $787 billion recovery package that Congress passed last February.

Christina Romer, council chairwoman, said job losses have declined dramatically since Obama took office. In the first quarter of 2009, job losses neared 700,000 a month -- a much greater figure than the number lost during the last month of the year.

While the hard-hit construction industry continues to lose jobs, public construction (including transportation projects) is rebounding as a result of recovery act investments. The U.S. Bureau of Labor Statistics reported last Friday that construction employment fell by 53,500 jobs in December; the unemployment rate for construction workers is 22.7 percent. However, public construction, fueled by recovery act dollars, was 5.7 percent higher in November 2009 than the previous November, according to the U.S. Census Bureau.

The House Transportation and Infrastructure Committee reported last month that 210,000 direct jobs have been created thus far by recovery-funded transportation projects. The Federal Highway Administration reported Jan. 8 that states have 6,333 highway and bridge projects valued at $15.2 billion funded by the recovery act underway.

"The construction sector is beleaguered," said AASHTO Executive Director John Horsley. "However, a thorough analysis of recovery spending on roads and bridges makes the case for even greater infrastructure investment, not less. States have identified 9,500 'ready to go' transportation projects worth $70 billion that, if funded, will put thousands of additional construction workers back on the job. Every single job counts and when you add it up, investing in roads and bridges makes good sense."

U.S. Transportation Secretary Ray LaHood noted on his blog Monday that the transportation construction segment represents only part of the total construction employment picture.

"When we drill down to the transportation construction industry, the most appropriate basis for analysis, we find recovery act spending making a real difference in people's lives," LaHood wrote.

LaHood also addressed the issue of transportation job creation during a speech at this week's Transportation Research Board Annual Meeting in Washington. (Video coverage is available from Transportation TV)

House Transportation and Infrastructure Committee Chairman James Oberstar, D-MN, and House Highways and Transit Subcommittee Chairman Peter DeFazio, D-OR, issued a joint statement Monday saying that data collected by the committee shows how transportation projects funded with recovery dollars have created jobs.

"Transportation investments make up only 6 percent of the overall recovery package, and not enough by themselves to overcome the high unemployment in the private sector," the pair said. "However, to dismiss them as having no effect at all is like saying it is a waste of time to feed a homeless family because that one act does not cure poverty."

The American Road and Transportation Builders Association released a statement from Alison Black, its senior economist and vice president of policy. Black said recovery funding "has been the lifeline that has, thus far, kept much of the industry afloat during the economic downturn."

Thanks to the recovery act, "overall investment in highway, bridge, and transit projects was up 12 percent through November 2009 and the market should continue to be stable, if not grow slightly -- absent additional state and local funding cuts -- through this year," she said.

Transportation advocates are pushing the Senate to enact a job-creation bill containing $37.3 billion for additional projects this year. (see related story)


Questions regarding this article may be directed to editor@aashtojournal.org.

 
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