Construction workers pour wet cement on a road. With 20% of the projected revenue for infrastructure, or $ 110 billion, dedicated to the construction of roads and bridges, small construction companies expect a long-term boom in businesses.
As small businesses recover from labor constraints and business losses due to Covid-19, a bill for bipartisan infrastructure offers hope for a boom that comes as it makes its way through the chambers of Covid-19. in Congress.
On August 1, the U.S. Senate finalized the text for the Infrastructure Investment Act, which describes $ 550 billion in new spending on roads, bridges, public transportation, vehicle charging stations electricity and other physical infrastructure, creating jobs and pulling the U.S. economy out of a downtick pandemic.
The White House says the bill will add about 2 million jobs a year to American workers, and the projects will last over the course of a decade. Chuck Schumer, leader of the Senate majority, said he expects the Senate to finalize the bill in a few days.
The corporate world has approved President Biden’s infrastructure plan as of late. Here’s how different factions in the small business community feel about it.
Federal money will flow to small businesses
With potential mass spending on physical infrastructure coming in the coming years, a number of small businesses are expected to profit from upcoming projects and contracts.
Although for John Walton, owner of John G. Walton Construction Company in Mobile, Alabama, the infrastructure bill will not only bring a boom to the economy, but it greatly needs improvements for deteriorated structures across the country.
Specializing in asphalt and highway construction, Walton’s company, like many other small businesses, is preparing to cash in on federal projects once it begins to make its way through state governments.
Walton said federal projects are managed through individual states. In Alabama, the Department of Transportation opens projects once a month to the offerings of local entrepreneurs. Once the invoice is signed into law and the federal money is given to individual states – the timing is uncertain although there is typically a delay between when an invoice is signed into law and when the federal dollars are awarded – the companies locals like Walton can bid for these projects.
With 20% of the turnover, or $ 110 billion, dedicated to the construction of roads and bridges, Walton hopes for a long-term boom in business.
“If states have entered the money, they can plan these projects,” Walton said. “Sometimes it takes two or three years from conception to real construction, so it really helps contractors because they know what’s going on in the pipe.”
These projects also help small businesses with recruitment efforts in today’s tight labor market, according to Brian Turmail, a spokesman for the American General Business Association.
“Passing any major multi-annual infrastructure measure will actually provide invaluable recruitment benefits for our industry,” Turmail said. “Because it will signal to a new generation of workers that there will be large infrastructure jobs out for so long.”
Although the Law on Investment and Investment in Infrastructure does not designate specific projects for unionized workers or requires that certain roles be occupied only by unionized workers, John Samuelson, president of the Union of Workers ’Workers. transport, he said infrastructure projects will inevitably lead to roles that are filled by unions. workers.
“When you look at it, it’s not like there’s a line that says‘ all these jobs will be unionized ’but it does need solid wages throughout the bill,” said Yvette Pena-O’Sullivan, spokeswoman for LiUNA, the International Union of Workers of North America, which represents unionized workers in the construction and energy industries in the United States and Canada.
Pena-O’Sullivan said any type of federal spending requires companies to pay their contractors and workers appropriate wages based on the status of the project. Salaries based on location are explained from the Department of Labor, in accordance with the Davis-Bacon Act.
“When you have a plan based on your salaries and requirements, it allows union contractors to compete and get the job done,” Pena-O’Sullivan said. “So I’m not competing with companies that are trying to push wages and pay people as little as possible.”
In addition to wage requirements, union workers can benefit from all industries based on the influx of jobs created by infrastructure projects.
“Regardless of what’s in the text or not, it will certainly help unionized workers in areas with high levels of union density, the Northeast, California, the Midwest,” Samuelson said.
The project provides $ 39 billion to improve public transportation and another $ 66 billion to modernize and expand passenger and freight transportation. Samuelson said all union workers will benefit from investments in the public transportation industry, from Miami to Houston, as far north as Pennsylvania and across the South.
Beyond geography, Samuelson said the public transportation industry has one of the most unionized workforces, and other projects are in the industry that have a high union concentration.
By 2020, there were 7.1 million unionized workers in the private sector and 7.2 million in the public sector, according to the Bureau of Labor Statistics. Of the 7.1 million unionized workers in the private sector, 20.6% work in the utility industry, 17% work in transportation and warehousing, and 14.3% work in telecommunications.
“Infrastructure modernization creates jobs, and many of them will be unions,” said Ed Mortimer, vice president of transportation and infrastructure at the U.S. Chamber of Commerce. “These are well-paid jobs that help American families.”
Revitalization of Main Street America
In addition to roads, bridges and public transportation, the infrastructure bill provides an additional $ 65 billion for broadband, $ 73 billion for energy infrastructure and $ 21 billion for environmental cleaning, which presents revitalization prospects to small businesses in local communities.
“Our infrastructure is collapsing,” said Kriss Marion, owner of Circle M Market Farm, a local farm in Blanchardville, Wisconsin. “Our roads, bridges, in some cases our water treatment plants, our pipes. We have long suffered from a chronic lack of investment.”
She said the infrastructure project gives hope to local communities that can be driving forces in the economy, and in the specific case of her community, improvements to roads and bridges will allow agriculture. to move around more easily, and allows people to travel more easily in cities.
Broadband poses an even bigger challenge, with 14% of households in Wisconsin not having access to the Internet, Marion said. The prospect of increasing broadband infrastructure across the state is the key to the future of rural development.
“I think we are going to see a renaissance of rural tourism and the rural economy,” he said.
Improvements in broadband infrastructure can save small businesses as the economy shifts toward online services and shopping, said Sarah Crozier, a spokeswoman for the Main Street Alliance, a small business advocacy organization.
“It will be important for small businesses to have access to broadband investments to be able to compete across the country,” Crozier said. “So we’re not just relying on massive online monopolies.”
But Crozier said there is a criticism that must be leveled against the project: to reach a bipartisan agreement on the package, several ideas of “human infrastructure” that had been defended by progressives were postponed to a later date. and a separate legislative effort, and many remain concerned about the fate of this part of the infrastructure spending.
“These gaps need to be covered through the reconciliation package, particularly around other bridges and roads that allow people to work, which are childcare and health care,” Crozier said. .
Leader of the Congress, Leader of the Senate Majority Chuck Schumer and the Speaker of the House of Representatives, Nancy Pelosi, want to pass the infrastructure bill with a $ 3.5 billion reconciliation package, which will invest in child care, paid leave, education and efforts. to fight climate change.