Construction Group Pushes For $1 Trillion Infrastructure Program Under Trump

Ken Simonson, chief economist with the Associated General Contractors of America, speaks during a press conference Tuesday in North Little Rock.
Credit Jacob Kuaffman / KUAR News

Officials with the Associated General Contractors of America visited central Arkansas Tuesday to push for a federal civil works program under President-elect Donald Trump that would invest over a trillion dollars in the nation’s aging infrastructure and bring more construction jobs to the Arkansas economy.

Citing data that the Little Rock metro area had lost more construction jobs than nearly every metropolitan area in the U.S., AGC economist Ken Simonson said a proposed plan by the incoming Trump administration could boost U.S. infrastructure investment nationwide and jumpstart a broad economy recovery.

According to analysis provided by the AGC at a press conference on the banks of the Arkansas River in North Little Rock, the number jobs in the construction, mining and logging sector in Arkansas has declined by 3% or 1,700 workers between October 2015 and October 2016. Of the remaining 57,400 jobs in the sector, the construction trade employed the lion’s share at 51,000 jobs. (Link here for a PDF of the AGC jobs analysis.)

“What makes these job losses even more frustrating is the fact many of them could have been avoided,” said Ken Simonson, the AGC’s chief economist. “Yet too many construction firms that work on vital infrastructure projects are seeing less work today than just a few years ago.”

Simonson said the Little Rock-North Little Rock-Conway metro area lost 1,800 construction jobs for the year, a 10% decline. He added that, out of the 358 metro areas the association tracks, only three metro areas lost more construction jobs during the past year and only five lost a higher percentage. There are 15,800 people working in construction in the metro area today, down from 17,600 a year ago, and the lowest October level since 1997, he said.

Nationwide, 73 out of 358 metro areas lost construction jobs for the year, while construction employment was stagnant in another 62 areas. The Fort Smith area was also among the national decliners, losing 5% or 300 of its 6,000 workers in one of the state’s highest-paying blue collar industries. Simonson said even thriving metropolitan areas like Northwest Arkansas, which has seen an increase of 400 jobs in the region’s 10,000-person construction trade, could eventually lose public sector investments in roads and bridges if Congress and the Trump administration’s proposal does not offer a significant, sustained increase in investment for schools, highways and other infrastructure projects.

“Without increased funding and new ways to pay for future repairs, it will only be a matter of time before our infrastructure begins to crumble again,” Simonson said.

And even with the news Tuesday that the U.S. economy had expanded by 3.2% in the third quarter, the AGC economist said the current post-recession recovery has not sustained any momentum that would give employers the confidence to increase hiring levels.

“It has been so inconsistent, mixing periods of sharp expansion with periods of contraction,” Simonson said. “The construction downturn lasted longer in Arkansas than in many other parts of the country. The state didn’t start adding construction jobs until 2012, more than a year after the construction industry (recovered) nationally and more than two years after the rest of the economy started adding jobs.”

A new infrastructure program will create tens of thousands of manufacturing, mining and service-sector jobs as equipment makers, aggregate firms and construction suppliers book higher orders, the AGC economist said. He said new investments will also make the economy more efficient and businesses competitive by cutting traffic delays, lowering energy costs and improving public health.

In response to questions after the press conference, Simonson the AGC is lobbying Congress to make sure President-elect Trump’s infrastructure plan becomes a reality. Yet, he said getting 51 senators and 218 congressmen to agree on a new federal program would be tough.

“We are having conversations all the time about what would attract enough votes to get through Congress,” Simonson said. “We don’t have a single preferred plan, but we do have a lot of proposals for ways that infrastructure could be funded. The trick is get those members … to pass something that the president would then sign. We don’t want to stay out one position and say ‘our way or the crumbling highway.’”

After Simonson spoke, Arkansas AGC President Thomas Dickinson said his association was also concerned about the recent loss in construction jobs across the state and was looking forward to proposal from the incoming Trump administration to propose new highway funding.

“We are encouraged by the incoming administration’s comments regarding future infrastructure funding and what that would means for hard-working individuals involved in building and repairing America,” said Dickinson, general manager for Little Rock-based McGeorge Contracting Co.

Dickinson said additional funding for schools, highway and other infrastructure project would reduce uncertainty from government agencies that oversee such projects.

“Stable, consistent funding for infrastructure allows construction and affiliated businesses a chance to retain their existing workforce and increase employment with additional projects and funding.”

Dickinson also said he hopes the Trump administration will continue to support funding for the Fixing America’s Surface Transportation (FAST) Act, which was signed into law by President Barack Obama nearly a year ago. To date, the Obama administration has authorized $305 billion for this five-year program, of which $800 million is available for projects in 2016.

After the press conference, AGC Executive Vice President J. Kelly Robbins said the association is working with the Arkansas Good Roads Foundation to come up with recommendations for the upcoming legislative session for the state’s future highway infrastructure needs. Earlier this summer following a special session that approved a five-year highway improvement plan financed largely by state surplus funds, Gov. Asa Hutchinson challenged the Good Roads group, AGC and other advocates for state transportation investment and spending to come up with a long-term solution for state highway and transportation improvements sans a tax hike.

“We hope to have something ready for the governor pretty soon,” Robbins said.

Earlier this month, Hutchinson laid out plans for a $50 million tax cut in the upcoming 90th General Assembly as part of his proposed a balanced budget of nearly $5.5 billion for the biennium. The legislative session begins on Jan. 9, 2017.