Washington’s $1.2 trillion infrastructure law includes a provision allowing states and localities to do targeted hiring of local people and certain marginalized groups — language that’s critical, its supporters say, because it should boost the number of people of color, women and low-income Americans who benefit from the bipartisan spending package.
“Congress, when they passed the infrastructure bill, took the really important step of clarifying into law that cities and states, when they’re doing transportation projects, are allowed to hire local people from communities where the projects are happening,” said Miranda Nelson, the national program director for Jobs to Move America, which was among the progressive groups that lobbied for such provisions.
“The language also encourages hiring from certain groups that haven’t traditionally had access to infrastructure jobs, and we think that’s exciting,” Nelson added. “We think that these projects, when they’ve been done around the country, have been really successful at diversifying the infrastructure workforce, and we’re happy that Congress has allowed that to happen on federally funded projects now.”
Advocates for the provisions aimed at what’s called “local hire” and “targeted hire” see a link between their recent lobbying efforts and the upcoming second anniversary of George Floyd’s murder by a Minneapolis police officer on May 25, 2020, which spurred many Americans to grapple more with racial discrimination and historical inequities.
“There’s so many aspects to the anniversary of the death of George Floyd,” said Lewis Finfer, a senior projects director at the Massachusetts Communities Action Network. “A piece of it is obviously about how people are treated — particularly people of color by policemen. A piece of it is also about what kind of opportunity is available in our country for all people.”
To address the issue of opportunities, it’s important to look at “what is the government doing, and how are they doing it,” Finfer told MarketWatch. There was a chance to “ensure that the jobs created in this massive bill” are “more fairly distributed to all people — including based on race and gender and income — than they might otherwise be,” he said.
“Local hire” means jobs could go to people in a specific city or even neighborhood, with targeting by ZIP codes or census tracts, he said. “Targeted hire” refers to jobs going to specific groups of people, such as low-income people, single parents, formerly incarcerated people, or people who grew up in foster care.
“It’s trying to target the money to people who don’t ordinarily have the chance at these types of jobs,” said Finfer, whose group is affiliated with Faith in Action, a national community organizing network.
The provisions allowing local hire and targeted hire are not the only parts of the Infrastructure Investment and Jobs Act PAVE, +1.92% aimed at addressing longstanding inequities. The law — which President Joe Biden signed into law a half-year ago and is now being executed — also includes $1 billion for “reconnecting communities” severed by highways decades ago, as well as funds for cleaning up hazardous-waste sites that disproportionately impact communities of color.
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Industry opposition
The Associated General Contractors of America lobbied against the local hire language, but an executive for the trade group for construction companies said its members are in fact eager to attract workers from local communities.
“Shucks, we’re investing an enormous amount of resources as a national association, and our members spend all their time talking about how do we increase hiring in the communities where we’re working, how do we diversify our workforce — which, from a business case and from a demographic case, are just essential to the survival of our industry,” said Brian Turmail, the group’s vice president for public affairs and strategic initiatives.
But Turmail said the U.S. over 40 years has “essentially disassembled” what was once a “robust” system focused on what was once called vocational training, but is now called career and technical education. He argued that local-hire efforts are a Band-Aid and just address a symptom, while the underlying problem is that communities are not putting in place career and technical education programs.
“The challenge is that when you put those mandates in place, you let communities off the hook from exposing students and young-adult workers to construction as a career path or providing them with any of the skills that are needed to operate safely — or even just consider construction as a career,” Turmail said. “So I know it makes good headlines, but it’s actually bad policy.”
His group lobbied lawmakers for greater funding for such programs, as well as for support for campaigns focused on diverse workforces and other initiatives, but it didn’t get “enough takers to change the bill,” he said. The Infrastructure Investment and Jobs Act passed the Democratic-controlled Senate in a 69-30 vote, with 19 Republicans supporting it, and it cleared the Democratic-run House in a 228-206 vote, with 13 House Republicans backing it.
Turmail sees some encouraging developments, such as the fact that both Biden and former President Donald Trump have talked up the value of construction careers and technical training. Plus, he said, the ratio of federal spending on promoting college attendance vs. spending that encourages technical training has dipped in recent years to 5 to 1, down from 6 to 1. And he noted that most of the career paths in construction don’t require people to take out student loans, at a time when many borrowers are clamoring for student-debt relief.
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But Turmail is downbeat on the local hire provision’s potential impact.
“You’re just stopping projects from happening in your community, or you’re making them more expensive, because firms won’t be able to hire the folks that they need to comply with a local hire agreement — which means that the project doesn’t happen, or the firm doing the work is gonna pay all kinds of fines and penalties,” he said.
Jobs to Move America, for its part, argues that costs won’t go up, pointing to its recent analysis of a Transportation Department local hiring pilot program.
“We compared projects that had used local hire to projects that did not use local hire to see if it had any effect on the number of bidders on the project, or the overall cost of the project, and we found that there was no effect,” said Nelson, the organization’s national program director. “If anything, slightly more bidders had bid on projects with local hire in them.”
What’s next
It’s “a significant step” to have the language on local hire and targeted hire in “the largest infrastructure bill in the history of our country,” said Finfer of the Massachusetts Communities Action Network. “But the devil is in the details,” he added.
As states get their infrastructure projects going, his group is now working with its partners in different places to make sure they talk to their local transit officials about implementing local and targeted hiring. “That’s going to be crucial,” Finfer said.
Moreover, the provisions only relate to Transportation Department projects and not other types of work, even as the bipartisan infrastructure package calls for spending on not just roads and bridges but also broadband, water facilities and more.
“We want to see local hire extended to other aspects of infrastructure,” Nelson said.
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Dozens of Democratic lawmakers agree with that view. Rep. Karen Bass of California and Sen. Kirsten Gillibrand of New York teamed up with more than 70 colleagues to send a letter last month to the White House’s budget office calling for updated regulations that allow states and localities do local and targeted hiring on all federally funded projects.
That party is expected to lose control of the House and possibly the Senate in November’s midterm elections, but analysts have said that could mean an increased focus on Biden’s powers as president and federal agencies’ moves.