Invest in Infrastructure and Emerging Industries
Public investments in infrastructure hold the key to rapid job creation. Economists agree that
investments in infrastructure are one of the most effective fiscal tactics to stimulate a sluggish
economy and reduce unemployment.42 Every dollar spent on infrastructure generates $1.44 of
economic activity. This makes it one of the largest multipliers per investment dollar, topped only
by a temporary increase in food stamps/SNAP and an extension of unemployment insurance.43
Infrastructure is a broad term. The kind of infrastructure investment with the potential to
create millions of jobs is public
works—for example, building roads,
Figure 1.6 Unemployment in the Construction Industry is Falling
repairing bridges and dams, and
But Continues to Exceed the Overall Unemployment Rate
renovating schools and office buildings. According to the Federal
30%
Construction Industry
Highway Administration, a $1 bilUnemployment Rate
25
lion expenditure on highway construction can support 30,000 jobs.44
20
The construction sector stands to
benefit more than other sectors from
15
investments in infrastructure. Construction suffered the highest rate
10
of job loss when the housing bubble
Civilian Unemployment Rate
burst45 and continues to face one of
5
the toughest job markets. By mid0
2013, unemployment rates were still
2006
2007
2008
2009
2010
2011
2012
2013
2014
nearly 10 percent.46 See Figure 1.6.
Shaded areas indicate U.S. recessions
In 2009, the American Society
of Civil Engineers estimated that
Source: Federal Reserve Economic Data (2013).
the United States would need
$2.2 trillion in infrastructure
investment to repair damage caused by longstanding neglect.47 The consequences of
decades of putting off upgrades to the country’s physical infrastructure became glaringly obvious during Hurricane Katrina in 2005 and S \\???H?[? H[? ? L??[??^H ?\?H?\? H?Y??\????\]Y[??\????H ? LH ? ? L? ?H^ ?[YH ?X]\?]?[? ??%???? ? ??\?[? ?[?\?\??%???[?H [? H?[[?XX? Y[?? \ ?[?\?[X]Y??[? N?[[?[?[XY?K??H?X??\?HX?[?? YY L??[[???]?[??\?Y[? ?[?[???\? ?X? \?K?] \??\?[ H?Y?[?? ?YY] H?YY ?HH[?]Y?]\?\? ?[??Y ?][? H ??[?[???\? ?X? \?H ]X[] K?[?[??][?XY?\?Y \?\? H??[? ?H??? ?[? ?\??? ?[???][?[???\? ?X? \?H [?]Y[? NM? ?L[??\?Y[? ?[?[???\? ?X? \?H??? H ?? X?B?[?HY??X?Y[? ?[???][? ?\??X?\??][ ???X[?\?Z\?[? ?]\?X[ Y\???? ??X\\?[X? ?X?] K[??\?\?[?\??] ?\??X?K??\? H?? \?K[\ ??[Y[? ?[? B???[? ?x?&\?[???\? ?X? \?H ?[XZ?H H[?]Y?]\?[?H??\]]]?K? ?]?]H ?X??? ?? X?]?] H?Z[??]?H?Y[?\?[X]Y][?]?\?H???H MH \??[? ?
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