November 16, 2009

U.S. stimulus won't prevent more layoffs in road construction industry: Survey

The $27 billion dedicated to highway construction in the $775-billion American stimulus package likely saved thousands of construction-related jobs. But it wasn't enough to prevent widespread lay-offs in road and transit construction businesses, a new survey shows.

And 44 per cent of contractors anticipate having to lay off more permanent employees due to overall economic conditions, the survey found.

The survey was conducted by the Transportation Construction Coalition, a partnership of 28 national associations and construction unions representing hundreds of thousands of individuals with a “direct market interest” in federal transportation programs, according to the TCC website.

While 70 per cent of transportation contractors surveyed reported receiving stimulus-funded contracts work so far this year, 63 per cent said they had to lay off permanent employees in 2009 due to adverse business conditions.

“The key to sustainable new job creation in the transportation construction industry is congressional passage soon of the overdue, long-term federal highway and transit program funding bill with new resources for the tapped out Highway Trust Fund,” says Mike Acott, president of the National Asphalt Pavement Association and a coalition member.

Coalition members say the stipulation that stimulus-funded projects be “shovel ready” has discouraged larger scale and longer-duration projects – the kind that sustain long-term personnel and equipment needs -- from receiving dollars.

Fewer than 20 per cent of the contractor respondents said they plan to purchase new construction equipment (19 per cent) or trucks (18 per cent) next year; just five per cent anticipate bringing on new, non-seasonal personnel.

“It is impossible to overstate just how difficult current conditions are or how dire the outlook for next year is,” said Ken Simonson, chief economist for the coalition member Associated General Contractors of America.

“One-time investments in transportation infrastructure like the stimulus help, but they’re simply no substitute for having a long-term investment strategy in our roads, bridges and transit systems.”

-RCD Digital Media

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