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November 7, 2013

Infrastructure Spending Will Employ Few Unemployed Workers

By

President Obama has an answer to our sluggish economy: more infrastructure spending. He proposes creating jobs by spending billions more on infrastructure. Sadly this idea only illustrates H. L. Mencken’s point that “for every complex problem there is an answer that is clear, simple, and wrong.”

As I explain in a new paper, even on Keynesian terms such spending would create few new jobs. Infrastructure projects are capital intensive—not labor intensive. A relatively small number of workers use advanced equipment to build our highways and roads. The entire highway, street, and bridge construction sector employs just 300,000 workers. That’s less than the population of Wichita, Kan. Machines, not men, do most of the brute work.

Moreover, those men (and women) are highly skilled. An unemployed residential electrician cannot simply start work building a highway overpass. It takes several years of training to learn how to operate construction machinery. Few of the currently unemployed have this training. Most of the fall in construction employment in the recession occurred in housing construction, not infrastructure. Just 1 in 200 unemployed workers previously worked as construction-equipment operators.

Consequently, most skilled workers hired on new infrastructure projects would come from other jobs (as happened with the stimulus). Additional spending would reshuffle who works where while creating few new jobs for the unemployed.

America does not need to increase infrastructure spending. Our roads have fewer potholes now than at any point in the past two decades. Of course the government should fix bridges and interstates in disrepair. But thinking this will reduce unemployment is simply wrong.

 - James Sherk is a senior policy analyst in labor economics at The Heritage Foundation.

Originally published by the National Review Online

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