Optimism Grows

Jan. 1, 2023
The results from our survey are (mostly) good

It is 2023, and optimism runs high in the roads and bridges construction industry.

In 2022, under Secretary of Transportation Pete Buttigieg, the U.S. DOT began to rollout the bipartisan Infrastructure Investment and Jobs Act (IIJA), and that influx of money—a $1.2 trillion infrastructure package that will deliver $550 billion in federal investments over five years—has a lot of people smiling.

However, not everyone is celebrating. There is some concern about the state of the industry, as well.

Most of the money in the IIJA will be allocated to states, which have final say in how it is spent. But the Bipartisan Infrastructure Law also offers new discretion and billions of dollars to the U.S. DOT. The Transportation Department received $120 billion to spend through new or expanding programs.

“There’s never been such a dynamic and fertile time to work on this because of the resources we have with the [President Biden’s funding] package,” Buttigieg told The Washington Post in October.

Most people working in the industry would agree.

This past summer, Roads & Bridges conducted a multi-part state of the industry survey. Respondents represented highway/heavy construction (47.9%), both building and highway construction (25%), general building construction (12%), technology development (10%), and material production (4.7%).

A whopping 89% of respondents said they expect business in 2023 to either be excellent, very good, or good.

“This is a moment of enormous opportunity with reason for optimism,” Buttigieg said in his prepared remarks to the House Transportation and Infrastructure Committee in July. “Thanks to the infrastructure law, my department has never seen a moment of greater potential than now—to build transportation resources that connect everyone safely, efficiently, and affordably to the things we need and the people we love.” 

This positive outlook also is expressed when business owners talk about their firms. When asked about the overall health of their businesses, most respondents answered good (43%) or very good (27%). Another 27% described the state of their firms as average.

However, there is a gap between optimism and satisfaction with how the Biden administration is rolling out the IIJA. Most respondents (44%) said they were disappointed, while 34% described themselves as content. Nearly 14% said they were very upset by the rollout, and almost 8% were very satisfied.

Another question that garnered interesting results asked how well respondents understood the rules and regulations under the IIJA as it pertained to their industry. Average (47.5%) was the top response, with 20.5% admitting their knowledge was weak and 7.8% saying very weak. Only 7.09% described their knowledge as very good, while 17.02% answered good. 

Regardless of how they feel about the IIJA rollout, those in the roads and bridges construction industry have their work cut out for them, especially when it comes to the nation’s bridges.

There are 224,000 bridges in America that need repair, according to analysis the American Road and Transportation Builders Association (ARTBA) released last February. ARTBA also reports that 1 in 3 U.S. bridges needs repaired or replaced. In transportation terms, there are 167.5 million daily crossings on 43,578 structurally deficient bridges that have been rated in “poor condition.”

In 2022, two bridges collapsed and made national news. Last January, the Fern Hollow Bridge on Forbes Avenue in Pittsburgh collapsed the same day President Biden was scheduled to visit the city to promote the IIJA. No one died in the collapse, but 10 people were injured.

In October, a bridge outside Kearney, Missouri collapsed, killing one person, and injuring three others. All four victims were trapped under debris from the bridge. Contractors were pouring concrete on the bridge deck when the bridge collapsed.

One of the issues with America’s bridges is the fact that contractors can’t repair them fast enough to keep up with the amount that are falling into “Poor Condition” each year. Out of 144 respondents, nearly 50% said the number of bridges on their list of those in poor condition stayed the same in 2022.

Most of our respondents think that rural roads are either fair (55.7%) or good (24.8%). However, 65% of those asked said rural roads are declining. Urban roads garnered similar marks for their state and whether or not they are declining 

The need to improve our infrastructure is at a historic high, and though the IIJA has increased optimism about the jobs outlook, there is a considerable amount of concern about rising prices. Of 149 respondents, 80% said they anticipate material prices to go up this year. The same goes for bid prices, where 78% say they are bracing for higher prices. 

The global supply chain crises slowed the transport of materials and equipment in 2022. Along with inflation, many in the roads and bridges industry are concerned about a recession in 2023.

If there is a recession, it could delay projects that are being funded by the IIJA. The economic forecast should become clearer by the end of the first quarter of 2023.

Unfortunately, even if a recession is avoided and the supply chain situation improves, the roads and bridges construction industry will face a much bigger problem in the ongoing labor shortage. Out of 144 respondents, 72% rated the availability of qualified workers for job openings as weak or very weak.

Fortunately, most of our respondents agree with how to fix the labor shortage. Improving apprenticeship programs (44%) and high school/vo-tech school programs (42%) topped the list.

The other two options for the question asking about how to fix the labor shortage were “More lenient State drug testing protocols,” which only two people voted for, and “Other (please specify).” The latter received 12.4% of the vote and garnered some interesting anonymous comments.

One respondent wrote: “The industry needs to focus on an "all of the above" strategy to fill labor job openings. Demonstrating that construction jobs are available at the high school vo-tech level is important to increase the applicant pool. Adding apprenticeship programs for skilled labor moves those entry level positions forward. There also needs to be a balance between expectation of drug abstinence and preventing recreational drug use from impairing job performance.” 

Another respondent suggested a targeted marketing approach on social media could help attract workers, while others said they would repeal regulations, and a few indicated that low wages are the problem.

In another question, most respondents answered that the qualified workers who are applying for job openings are weak (41.67%) or very weak (30.5%).

Interstate roads are a bright spot. Nearly half of our respondents (48%) said they are in good shape, while 35.7% described them as fair. And, over half (53.6%) said interstate roads are improving.

The industry has reasons to smile as the year begins, but 2023 might not be that easy. A lot seems to be riding on the economy and how quickly funds from the IIJA can be injected into each state. R&B

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