A Summary of the Bipartisan Infrastructure Bill HR 3684 How it is going to help the construction industry, the national economy, and job creation? By almost any measure, the recently enacted $1.2 trillion Infrastructure Investment and Jobs Act (IIJA) is enormous. In round numbers, $650 billion of the bill represents funding of the nation’s current federal infrastructure programs at continuing baseline levels for FY22–FY26 (five years @ $130 billion/yr). The remaining $550 billion is what the bill has added - above baseline levels. The $550 billion represents “Extra Funding” added to existing
federal programs, plus the addition of some new infrastructure programs. The $550 billion “Extra Funding” will not be evenly split over five years. It is expected that about 57% will be paid out in the first five years and 43% paid out in FY27–FY31 as jobs get awarded and completed. Some new programs will take time to roll out and FY22 will see a lower increase due to the fact it is already half over.
The Government projection for spending the $550B looks like this: FY 2022 2023 $B 27.2 50.5
2024 68.0
2025 81.9
2026 88.4
(2022-26) ($316B)
2027 74.0
2028 2029 2030 2031 (2023-31) TOTAL 61.0 43.0 32.0 24.0 ($234B) $550B
In the simplest analysis let’s take the $550B “Extra Funding” divided by 10 years = $55B/yr “Extra Funds.” Baseline Federal Spending of $130B/yr + $55B/yr = $185B/yr = Average 42% increase in annual federal infrastructure funding – ignoring inflation. Increases to most “traditional” infrastructure programs will be much less than 42% because the $550B also funds a host of new infrastructure programs and initiatives.
T
his spending touches every sector of infrastructure – from roads and bridges to water and sewer to energy and broadband – all with an eye toward resiliency to resist damage from changing weather patterns. The Bill is intended as an aggressive plan to modernize, upgrade, and protect the country’s network of important infrastructure assets while advancing clean and renewable energy initiatives and reducing dependence on fossil fuels.
Job Creation The IIJA will provide millions of new job opportunities while requiring capacity expansions in both the private and public sectors. The engineers that design these projects will need more staff and office space. The contractors that build the projects will need additional tradesmen, managers, and more trucks and heavy equipment. Some companies
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that traditionally perform private sector work are expected to enter the public sector market. New business start-ups are predicted and are expected to receive encouragement and support from government agencies. Several specific funding programs are new to some federal agencies and may take some time to roll out. The massive increase in the number of projects being applied for, being built and overseen, and being billed out will require increases in public sector hiring at municipal, state, and federal levels. The additional $550B in funding is expected to create approximately 4.6 million *additional jobyears of direct and indirect full time employment positions. Infrastructure-related jobs, which now comprise 12% of jobs in the U.S. workforce (130M full time U.S. workers X 12% = 15.6M), would increase temporarily to 14% of total U.S. jobs. The continued on page 23
“BUY FROM THE ADVERTISERS IN CONSTRUCTION OUTLOOK”
JANUARY, 2022
