Brian Wilson and the math for 10,000 new highway jobs in Maryland
Fox News reported about the press conferences held by governors across the country to talk about how the recently passed $787 billion debt-stimulus bill is going to create jobs.
Brian Wilson reported that Maryland Gov. Martin O’Malley (D) explained that $365 million in debt-stimulus would support 10,000 jobs in Maryland. Wilson showed that the average highway construction worker makes about $32,000 a year. 10,000 jobs * $32,000 = $320 million, or 87.7% of the total, leaving only 12.3% for construction materials, like concrete, asphalt, steel.
Wilson assumed work for a year, but job numbers would be more for stimulus work less than a year, or job numbers would be less for a multi-year stimulus.
Wilson investigated where the 10,000 job number came from. Wilson could find no hard evidence for the 10,000 figure, and the one source he found had a huge disclaimer. Watch the “Crunching the Numbers” video.
Wilson asked an economist if the job numbers could be believed. Economist Peter Morici said the numbers were “absolutely inaccurate” and are a “gross exaggeration.”
Today, Kansas announced $377 million in highway projects that would provide 10,000 to 11,000 jobs. Wilson’s job math seems to beg similar questions in Kansas, and whether there really are 10,000 jobs here.
Gov. Sebelius’ Kansas Recovery web site gives an overview of the effect of the debt-financed stimulus money in Kansas, including:
Modernize Roads, Bridges, Transit and Waterways: Kansas will receive an estimated $350 million under the American Recovery and Reinvestment Act of 2009 for highway construction projects that will create or sustain thousands of jobs and make important improvements to the state’s transportation system. In addition, Kansas will receive an estimated $27 million to be spent on transit projects throughout the state.
Kansas will have a total of $377 million for highway work, with $350 million from the debt-financed stimulus. The 2,802,134 citizens of Kansas each must pay about $125 for this $350 million in new debt. That would be $500 in new government debt for a family of four.
Yesterday’s press release by Lt. Gov. Mark Parkinson, and Transportation Secretary Deb Miller, said
Kansas stands to gain more than 10,000 jobs from these projects.
Today’s Topeka Capital-Journal suggests
Based on the Federal Highway Administration’s method for determining job creation through funding for highway projects, economic stimulus spending in Kansas will generate between 10,000 and 11,000 jobs.
Using Brian Wilson’s job math, yearly salaries for 10,000 to 11,000 highway jobs would cost about $320 million to $352 million. This would mean that 84.9% to 93.4% of the total cost for these highway construction jobs would be salaries, leaving only 6.6% to 15.1% to buy concrete, asphalt, steel, and all the other materials to build the roads and bridges.
As Brian Wilson concluded after his discussion with the economist, only “hope” seems to explain the numbers given to the public, in Maryland, in Kansas, and the other debt-stimulus jobs.
Related:
- Crunching the Numbers, Fox News, Feb 20, 2009.
- “The government is promoting bad behavior,” Kansas Meadowlark, Feb 20, 2009.
- “Generational Theft”: Kansas’ share of bailout/stimulus debt perhaps $23 Billion, Kansas Meadowlark, Feb 10, 2009.
Tags: Brian Wilson, Debt-Stimulus, Highway jobs
Every government agency with transportation in their budget is salivating at the prospect of the stimulus money. But there is more to just building/improving a desired road or bridge.
1. Government agencies need to strongly state that this is one-time money and cannot be transferred to baseline budgeting.
2. What will be the cost of maintaining these additions and improvements and will that be factored into future budgets? What will that cost be?
3. Will all these construction jobs be limited to union workers?
4. Did Overland Park anticipate this when they annexed all that land south of I435?
It seems to me that money would go a whole lot further if Bacon-Davis was suspended, but I won’t hold breath on that one.
The KC Star reported this morning that “widening U.S. 69 between I435 and I35 will cost $84M and gives access to 90,000 jobs within a 3 mile area”. The end of the article states “Estimates indicate that in the afternoon rush hour, it takes someone 15 minutes to drive 11.5 miles on U.S. 69 to 167th Street. By 2030 the same commute was predicted to 35 minutes if nothing was done. Eventually, Overland Parks wants to widen U.S. 69 all the way to 167th Street, which will bring the cost of improving the corridor to more than half-billion dollars”.
To me, that is an awful lot of money to save a communter 20 minutes.
With the construction estimated to last 2.5 years the communters complaining about the commute time now are in for a longer commute and lots of orange barrels.