According to a new study released by Alliance for American Manufacturing, the nation's infrastructure is the most effective approach to creating new jobs that could be included in such a stimulus. Roughly 18,000 new jobs would be created for every USD 1 billion in new infrastructure spending on the nation’s transportation, energy, water systems and public schools.
The report, undertaken for AAM by a team of researchers at the University of Massachusetts Amherst's Political Economy Research Institute, found that at least 2.6 million new jobs could be created by increased spending in a high end scenario of USD 148 billion per year. While the construction and service industries will see the vast majority of job creation, manufacturing, which has been devastated by the current economic crisis would also benefit from such an infrastructure stimulus, seeing an increase of 252,000 jobs nationally.
The report further notes that manufacturing employment gains from such an infrastructure program could be improved significantly if the percentage of US made material inputs were increased. Simply put, a higher share of domestically produced supplies would have a significant impact in terms of generating new manufacturing jobs. Utilizing 100% domestically produced inputs for infrastructure projects would yield a total of 77,000 additional jobs nationally. Manufacturing would account for a significant 69,000 of that increase, a 33% jump in total manufacturing jobs generated.
Mr Leo W Gerard president of United Steelworkers said that "The nation is confronted today by the worst economic downturn in decades and a deteriorating infrastructure. We need to immediately address both problems. By making major investments to repair and upgrade our infrastructure, we will create much needed, good paying jobs that will help to get the economy back on track. America too must have its own capacity to produce the infrastructure materials we need."
Mr James Heintz, Mr Robert Pollin and Mr Heidi Garrett Peltier the report's authors said that "Public investment makes substantial contributions in terms of employment, economic growth, trade competitiveness, and essential services to the US population. Such investments can also become a key driver in building a clean energy economy. The public infrastructure portion of this program would also increase private sector growth by about USD 80 billion per year, which amounts to a productivity dividend of about USD 260 per year for every US resident."
Expanded infrastructure investments would have significant benefits for the private sector, beyond improving productivity and overall economic growth. Sustained over time, for example, it would raise the annual growth rate of manufacturing by nearly one percentage point and would contribute to the nation's gross domestic product.
(Sourced from www.americanmanufacturing.org)
