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KAI RYSSDAL: When that September unemployment report does come out Friday morning, a good many analysts are going to dig down in search of one particular number: How many jobs were added, or lost, in the construction business.
That figure’s going to speak volumes about how badly the housing slump and the credit squeeze are beating up the rest of the economy. In a way, though, construction — building infrastructure, specifically — is beating up the economy all by itself.
From WBUR in Boston, Monica Brady-Myerov explains.
MONICA BRADY-MYEROV: Orange construction barrels line parts of Massachusetts Avenue in Cambridge. Work to repave the road connecting MIT and Harvard, redo the sidewalks and add trees started three years ago this fall. That’s when MIT engineering professor Fred Moavenzedah greeted a new class of freshmen. Now those students are seniors, but the road project is only three-quarters complete.
FRED MOAVENZEDAH: This paving of this street could have been done in less than six months, rather than taking three years — if they had put sufficient man power and equipment, day-in, day-out, night-in, night-out.
Thousands of roads and bridges across the country are in this predicament. In Massachusetts alone, 43 percent of the road and highway projects under construction aren’t finished on time.
Taxpayers foot the overruns to the tune of $30 million a year, and that’s just Massachusetts. Nationally, the problem explodes into a $1.6 trillion headache. Barry LePatner is a construction lawyer who follows the industry closely:
BARRY LEPATNER: If we were to start allocating even $100 billion to attend to most-needed repairs on highways, bridges and tunnels around our nation that are imminent danger, we may be in jeopardy of wasting — through our construction industry — as much as $50 billion of that through inefficiency.
The first problem is the industry’s bidding process — the lowest bidder often wins. But Professor Moavenzedah says that low bidder knows his offer is unrealistic.
MOAVENZEDAH: These contractors reduce the cost to bare bones in order to get the job — so obviously, you expect some delays, or cost overruns, or complication in the future.
Then there’s a rush to get things built, even though the state hasn’t finished approving the designs. Again, Barry LePatner:
LEPATNER: No one should start a construction project in this nation unless the drawings and specification prepared by the architect and engineers are 100 percent compete and prepared, in conduction with review by the contractors.
When the contractor hasn’t approved the plans, it’s easy to run into unforeseen problems — like the need to move a telephone pole. And then the state has to pay for the fix. LePatner says you wouldn’t remodel your kitchen this way, so why rebuild a road or bridge like this? But Massachusetts Highway Commissioner Louisa Paiewonsky says the state bureaucracy isn’t efficient either.
LOUISA PAIEWONSKY: I think it’s fair to say while there are often good reasons for construction delays — including environmental, or work permit restrictions or utility delays — that doesn’t mean we find that acceptable.
Another problem is that the industry is composed of lots of small companies that don’t have the money to invest in research or the latest technology. LePatner says no wonder we’re building our roads and bridges very much the same way we were 150 years ago.
In Boston, I’m Monica Brady-Myerov for Marketplace.
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