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AP Story on Stimulus-Funded Highway Work ‘Flawed’

Says Top Construction Economist

Ken Simonson, chief economist for the Associated General Contractors of America issued the following statement today in response to an Associated Press story looking at the impact of stimulus-funded highway projects on overall construction employment:

"While highway construction plays a significant role in shaping the nation's economic fortunes, it only accounts for five percent of the total domestic construction workforce. And because of declines in the amount of state and local funds invested in road work in 2009, the roughly $20 billion in federal stimulus highway funds obligated in 2009 only contributed to a $4 billion net increase in highway construction activity last year. Meanwhile, total construction spending declined by $137 billion between November 2008 and 2009 to a six-year low of $900 billion.

"As we cautioned the story's two authors in advance, the fundamental assumptions in today's Associated Press story are flawed. It is virtually impossible to measure the impact of $4 billion by looking at overall employment figures for an industry experiencing a $137 billion drop in activity - especially when only one in twenty construction workers stand to benefit from those stimulus funds."

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