Stimulus Slow to Create Jobs in General Construction, Group Says

By Alexi Mostrous
Washington Post Staff Writer
Friday, July 31, 2009

President Obama's $787 billion stimulus plan is having little effect on job creation within the general-construction industry, the trade association for the sector said Thursday.

Construction spending was "disappointingly slow" five months into the recovery program, with firms working on stimulus-funded construction projects hiring at no greater rates than those without such work, according to the Associated General Contractors of America, known as AGC.

The findings are based on a survey of almost 1,000 construction companies.

Polling has shown that confidence is dropping in the measure's ability to reverse the economic decline, and its success or failure could become a central plank in the 2010 midterm elections.

While few new jobs were reported, 60 percent of firms surveyed by the AGC said they had saved jobs because of the stimulus package, which the AGC estimates is worth $135 billion in construction contracts. "We've been able to keep a lot of our employees in Arizona and New Mexico," Deena Billings, senior vice president with FNF construction, an AGC member, said Thursday.

AGC chief executive Stephen E. Sandherr said that the stimulus act is having an impact but not delivering on its full potential. "With construction unemployment at almost double the national rate, it is disappointing to see so many stimulus programs getting off to such a slow start," he said.

The transportation sector has seen stimulus money flow into road, rail and seaport projects, partly because states already had identified "shovel-ready" contracts. But only a few general-construction projects have been funded under the stimulus act, the AGC said.

At the time of the survey, the Army Corps of Engineers had paid out only $84 million of $4.6 billion granted it under the stimulus, the AGC said. The General Services Administration, given $5.9 billion, had paid out only $12 million.

© 2009 The Washington Post Company