Construction jobs up in most metro areas, but road projects threatened by Highway Trust Fund shortfall

The construction industry is adding jobs in most of the country, but this progress could come to a screeching halt this summer if Congress allows the federal Highway Trust Fund to run out of money.

That’s the word from the Associated General Contractors of America, which reports that construction employment has grown in 197 out of 339 metropolitan areas across the nation over the past year.

But in most areas, construction jobs still aren’t back to the levels they were before the financial crisis hit in 2008.

That “shows just how hard hit the industry was during the downturn and how vulnerable it is to disruptions, such as a potential lapse in federal highway funding,” said Ken Simonson, the trade association’s chief economist.

The U.S. Department of Transportation projects the federal Highway Trust Fund will run out of money before the end of the government’s fiscal year, possibly as early as August. That means Congress must come up with additional money to keep highway projects funded, even as it works on reauthorizing federal highway and transit programs, which expire Sept. 30.

The problem is that gasoline taxes, which haven’t been raised since 1993, no longer bring in enough money to support the level of highway construction that Congress thinks is necessary. You can blame more fuel-efficient automobiles for that.

In 2012, Congress supplemented federal motor fuels excise taxes with $20 billion in additional money, in hopes this would get the Highway Trust Fund through this fiscal year. It turns out that wasn’t enough money.

Hashing out a new highway bill will be one of the must-do items on Congress’ agenda this summer. There were signs of progress on that front before Congress took its two-week spring break this month. One key issue is how to fund highway projects in the future — raise gasoline taxes or find some other form of revenue?

But the shortfall in the Highway Trust Fund can’t wait for resolving that issue, the construction industry argues. It’s joined forces with labor unions on a lobbying campaign, Hardhats for Highways, to persuade Congress to address this summer’s shortfall as soon as possible.

“It would be an economic travesty to put thousands out of work and undermine the construction industry’s recovery because Washington officials don’t fix a problem they’ve known about for months,” said Stephen Sandherr, CEO of Associated General Contractors of America. “This isn’t the kind of summer break hard-working craftsmen and women expect or deserve.”

Source: Philadelphia Business Journal