How Infrastructure Investments Support the U.S. Economy: Employment, Productivity, and Growth

Source: Robert Pollin, James Heintz and Heidi Garrett-Peltier, Political Economy Research Institute, 2009

The U.S. system of public infrastructure has deteriorated badly over the past generation. The breaching of New Orleans’ water levees in 2005 and the collapse of the I-35W bridge in Minneapolis in 2007 offered tragic testimony to this long-acknowledged reality.

The project of rebuilding our infrastructure now needs to be embraced as a first-tier economic policy priority, and not simply to prevent repetitions of the disasters in New Orleans and Minneapolis. Infrastructure investments–particularly core economic infrastructure in energy, transportation, and water and sewerage–are essential for the functioning of the U.S. economy.

With the deterioration of economic conditions in recent months, public investment is back on the policy agenda, as a job-creation program linked to the need to revitalize the nation’s crumbling infrastructure. In this report, Robert Pollin, James Heintz and Heidi Garrett-Peltier examine the employment impacts of an expanded infrastructure investment program and what it would take to create millions of jobs. They examine the long-run impacts of such a program on productivity and economic growth, and offer brief observations on U.S. competitiveness and environmental sustainability that emerge from the findings.

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