Smart Growth Around America

Future jobs bill can realize a greater return by spending more on public transportation.

An Associated Press report on the impact of transportation stimulus spending underscores the need to make the right transportation investments in Congress’s current jobs bill to produce more jobs.

“The AP report highlights an important question that data from the stimulus have already answered: where should we be spending money in Congress’ upcoming jobs bill to get the most bang for our buck? The facts on that point are crystal clear. Investing more of money in public transportation creates more jobs — nearly twice as many per dollar compared to traditional highway spending,” said Smart Growth America president Geoff Anderson.

While the AP study asked a crucial question, its attempt to answer has critical problems. The most notable shortcoming of the study — which AP has only reported on, but did not release — is that to assess the impact of transportation spending, it looked at job-creation statistics in the entire construction sector, to which highway construction contributes just five percent, according to the Associated General Contractors of America.

“We should measure the effectiveness of transportation spending,” said Anderson. “But it makes little sense to ask whether work in five percent of the construction industry can move the whole thing.” The full AP story, which wasn’t carried by all outlets, acknowledged that studies of the impact of the full stimulus on the full economy find that the stimulus is working.

Perhaps more important, the AP looked at only at road and bridge spending, and missed the thousands of jobs created by investment in public transportation.

Once it gets into the detail of how states spent their current stimulus funds, the AP story gets to the heart of the question about what Congress — and state recipients of any future jobs funds—should do. As the AP noted: “…money for road construction offers little relief to most contractors who don’t work on transportation projects, a niche that requires expensive, heavy equipment that most residential and commercial builders don’t own.”

That observation backs up the findings in the recent report from Smart Growth America, the Center for Neighborhood Technology, and US PIRG. “What We Learned from the Stimulus” showed that current stimulus money spent on public transportation created twice as many jobs per dollar as traditional highway spending. Investments in public transportation work better as stimulus in large part because they spend more money on labor — and more kinds of labor. For example, the part of the current stimulus directed to public transportation built several intermodal centers. That puts the construction trades to work. (What We Learned from the Stimulus: And how to use what we learned to speed job creation in the 2010 jobs bill.)

Concluded Anderson: “As the Senate debates a bill to create jobs through targeted investments, all the evidence points to the fact that spending more of that money on public transportation will employ more people and have greater economic impact. If we are serious about creating the jobs we desperately need, members of the Senate will insist on investing a greater percentage of the transportation funds in public transportation.”

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