Obama’s Job Plan: The Construction Industry Sounds Off About the President’s Big Jobs Bill

America’s construction industry needs jobs. We’ve been howling the fact at Washington for two years. While the national unemployment rate has hovered between 9 and 10 percent, the construction industry has suffered nearly twice the national average over the last few years. In January 2011 the construction unemployment rate was at 22.5 percent and that was actually down from 24.7 percent from January 2010. Those numbers are getting better (in August 2011 construction unemployment hit 13.5 percent), but  President Barack Obama thinks he might have a plan to further help propel the construction market.

Obama proposed a $447 billion jobs plan to Congress in September that has the potential to inject lots of jobs into the construction industry. Titled the American Jobs Act, the proposal includes more than $250 billion in tax incentives for small businesses and employers, according to administration estimates. The rest of the money would be devoted to infrastructure spending, state aid, unemployment insurance and neighborhood rehabilitation. The president will pay for the proposal by asking the congressional super committee tasked with finding $1.5 trillion in deficit reduction to offset the cost of the package in their proposal.

The President’s previous stimulus packages have had a variety of receptions in the construction sector, but this new plan has plenty of construction-related stimulus, which is making industry leaders buzz.

“As the president made clear, too many Americans are out of work or underemployed. Nowhere do we see that problem more severely than within the construction industry,” explained CEO of the Associated Contractors of America Stephen E. Sandherr. “Although construction represents only 4.5 percent of the U.S. workforce, construction workers have accounted for over 20 percent of the jobs lost … Investing in infrastructure is the most effective way to create good jobs, deliver great roads, build a strong economy and protect taxpayers. That is why the Associated General Contractors of America stands with the president and everyone else who is willing to make the investments needed to revive our industry and rebuild our economy.”

Of course, everyone’s not impressed. Many see the amount of spending Obama is proposing as problematic and the vague outlines for how it will be paid for are raising more than few eyebrows. The idea that the super committee will pick up the tab seems unlikely to quiet Republican criticism that the plan will increase the national debt. Organizations like the Associated Builders and Contractors (ABC) are also calling for fiscal restraint.

“We are disappointed that the president did not come up with any new, innovative ideas to address the nation’s serious economic problems, especially the critical issues facing the construction industry,” said ABC national chairman Michael J. Uremovich. “Job growth will not begin until we first rollback the costly, burdensome and job-killing regulations that have buried business owners in government red tape and created a climate of uncertainty among construction contractors.

“Missing from the president’s plan was an initiative on public-private partnerships as an opportunity to responsibly invest in improving our nation’s infrastructure, including energy facilities, schools and military installations without adding to our deficit. The Military Housing Privatization Initiative is one example of a public-private partnership where both the private sector and the federal government profited, jobs were created and federal infrastructure was improved, enhanced and expanded at no cost to the taxpayer, the federal government or the deficit.”

The American Jobs Act proposes many types of jobs creation, but when it comes to “putting workers back on the job while rebuilding and modernizing America,” the President plan proposed six main initiatives:

1. A “Returning Heroes” hiring tax credit for veterans: This provides tax credits from $5,600 to $9,600 to encourage the hiring of unemployed veterans.
2. Immediate investments in infrastructure and a bipartisan National Infrastructure Bank, modernizing our roads, rail, airports and waterways while putting hundreds of thousands of workers back on the job.
3. A New “Project Rebuild,” which will put people to work rehabilitating homes, businesses and communities, leveraging private capital and scaling land banks and other public-private collaborations.
4. Expanding access to high-speed wireless as part of a plan for freeing up the nation’s spectrum.
5. Preventing up to 280,000 teacher layoffs, while keeping cops and firefighters on the job.
6. Modernizing at least 35,000 public schools across the country, supporting new science labs, Internet-ready classrooms and renovations at schools across the country, in rural and urban areas.

While all the sectors mentioned above are genuine pillars of the construction industry, there seems to be one major market missing – housing. The housing industry is the bedrock of small entrepreneur contractors and landscapers – the major readers of Compact Equipment. Bob Nielsen, chairman of the National Association of Home Builders (NAHB), noticed the missing housing stimulus immediately.

“While the nation’s home builders commend President Obama for tackling critical employment issues, it’s discouraging that the Administration still fails to recognize that housing has a central role to play in restoring the nation’s workforce,” said Nielsen in a statement. “In normal times, housing accounts for 18 percent of the nation’s gross domestic product, and nothing packs a bigger local economic impact than home building. Constructing 100 average single-family homes generates more than 300 full-time jobs, $23.1 million in wage and business income and $8.9 million in federal, state and local tax revenue.

“Housing has traditionally led the nation out of past recessions and needs to be playing a far bigger role than it has so far in today’s lackluster recovery. That won’t happen until federal regulators move to end the credit freeze for new home production, banks allow qualified home buyers access to affordable home loans and policymakers acknowledge there is a clear need to support homeownership and get housing moving again to spur growth, create jobs and restore consumer confidence.”

Watch the President’s speech below.