Tag Archive for 'economy'

The Socio-economic Importance of Road Construction

By Krysten Jetson

Airoport

http://en.wikipedia.org/wiki/Airport

Excellent infrastructure is the backbone and chief driver of socio-economic development, which every country strives to achieve. In the US during the 1950s and 1960s, massive and strategic investment was made to build world-class interstate highway systems and transportation infrastructure. All this contributed in making our country the undisputed world leader and an economic superpower. Investment in surface transportation helps to connect people, drive commerce and maintain global competitiveness. At the aggregate level, efficient transport systems reduce costs in many economic sectors by providing better accessibility to markets, increasing employment, bringing in foreign investment and improving global presence of countries. Transport carries an important social, economic and environmental load, which can never be over-stated.

The socio-economic significance of infrastructure development is extensive. Let’s have a look into the impact of infrastructure development on our lives.

Economic effects of transportation infrastructure

In the US, the Federal Highway Administration estimates that $170 billion in capital investment would be needed on an annual basis to significantly improve conditions and performance of our infrastructure. Once the envy of the world, America’s critical infrastructure, including its roads, bridges, mass transit systems and systems for delivering energy, may soon find it difficult to meet society’s needs. Let’s see how the transport infrastructure affects the economy.

1)    Mobility and economic effects. Economies that possess greater mobility are often those with better opportunities to develop, than those with scarce mobility. Reduced mobility impedes development while greater mobility is a catalyst for development. According to recent reports, forty-two percent of America’s major urban highways remain congested, costing the economy an estimated $101 billion in wasted time and fuel annually. Better roads and connectivity can translate into massive savings, both for the state as well as citizens. Transportation also weaves a complex web of relationships between consumer, manufacturer and distributor. The productivity of space, capital and labor is enhanced with the efficiency of distribution and personal mobility.

  • Less cost. A more efficient distribution and procurement network directly results in lesser prices for consumers. This is because transportation costs form a major chunk of the total cost of each output in manufacturing.
  • Wider reach to business. With better transport facilities there is access to a wider market or consumer base which leads to better economies of scale in production, distribution and consumption.
  • Better and diverse products. Good infrastructures give access to larger and diverse base of quality inputs, and broader markets for diverse outputs. This is good for the consumer as well as the manufacturer.
  • Increased competition. When transportation is efficient, there is a wider market for goods and services, resulting in increased competition. A wider array of goods and services to choose from, reduced cost and improved quality are some of the benefits passed on to the consumers. Also, this promotes innovation and technological advancement.

2)    Mobility and economic opportunities. Transportation development and improvement that took place since industrial revolution has shaped and transformed economies and social geography of nations.

  • Attractive to foreign investors. Excellent infrastructure has always made the US an attractive destination for global corporations to invest and do business in. Good connectivity lowers transport costs, and contributes to reliable and cost-efficient supply chain management. A poor transport service level can negatively affect the competitiveness of regions and corporations, and thus have a negative impact on the brand value of our country.
  • Attractive to new-age businesses. Transport infrastructure is always important, but their relative importance in supporting the changing demands of economy  may evolve. When an economy shifts from being manufacturing-based to service-based, there is more orientation towards efficiency of logistics and urban transportation. An infrastructure that grows and evolves to support the changing needs of the economy is attractive to both businesses as well as stakeholders like new-age employees and students.
  • Increased employment opportunities. A growing economy opens up new and expanding range of employment potential as well. New businesses and sunrise industries are voracious creators of job opportunities. The ‘feel good’ vibe that they bring into ageing, developed economies can be quite rejuvenating and energizing. Transport systems need to evolve in time and space as they include the timing and the nature of the impact of transport on economic development.

Social effects of transportation infrastructure

Roads and bridges change the face of landscapes. Increased connectivity brings societies closer to the outside world, and brings in influences from far and wide. The societal and cultural impacts are many.

  • Mobility benefits. Though societies on the whole reap benefits of growing and improved connectivity, some people enjoy it more than the others. Higher the income, the more the opportunity to benefit from infrastructure growth and economic opportunities. They also have increased ability to afford travel. Inclusive growth, by promoting connectivity in rural, under-developed and poorer regions can help all sections of society benefit.
  • Rising land value. With roads and highways linking vast areas of land with cities and towns, land prices also show a trickle-down effect from those in urban locations. There has been quite marked and sharp increase in land prices observed once infrastructure improves.
  • Improved quality of life. When transportation facilities increase, especially in far-flung and land-locked areas, prices of goods and services come down drastically. A wider array of products is available at reasonable prices. This helps to improve household finance and savings.
  • Congestion and accidents. A growing population and ageing infrastructure leads to overcrowding and congestion in urban areas. Serpentine traffic-jams lead to wastage of time, fuel and energy. Accidents also become common. Environmental pollution used to be a major issue, but with strict emission laws there is a continued effort to curb the menace.

Conclusion

Infrastructure determines the longevity and success of a nation. A good, upgraded and efficient transport infrastructure is essential for a strong and thriving economy. According to the American Society of Civil Engineers, an investment of $3.6 trillion will be needed by 2020 for the repair, upgrade and development of infrastructure. But the available funds are nowhere near this gigantic figure. Experts say that while it is important to have more money because the needs are so great, there is also a need to cut spending on shiny new projects in places with insufficient demand. The authorities need to spend on maintaining and improving infrastructure in the places with some of the greatest need.

Author Bio:

Krysten Jetson is a freelance writer specializing in the construction industry. She loves sharing her expertise on various aspects of the construction industry, especially safety, such as fall protection, workers safety etc. She has many years of professional experience including working with clients to build their business and brand through internet marketing strategies.

All Jammed Up

BY: HANNAH HAMILTONUSGS

HHAMILTON@USGSGOV, ETHAN ALPERN EALPERN@USGS.GOV

lookingDSfromBridgeIce Jams in Powder River at Arvada, WY, downstream of the bridge.

April showers may bring May flowers, but spring can also bring ice jams to the thawing rivers and streams across the northern United States.

An ice jam or ice dam, is a buildup of broken ice in the river system. It can be a problem that causes the water to back up over the top of highway bridges, roads, or into cities. At times, they can cause flooding. Ice jams can be large–backing up water for miles, or small and only back up water in a small area locally.

An ice jam can damage bridges with the amount of water pushing on the jam from behind; it can force the ice to push the bridge – moving it slightly.

USGS monitors ice jams across the north using cameras as well as by collecting ice thickness information when technicians do regular streamgage work or when measuring discharge on the rivers in the spring.

For example, each year, the Maine Emergency Management Agency and U.S. Coast Guard asks the USGS to measure the ice thickness and provide an ice jam flood potential on the Kennebec River. The U.S. Coast Guard has used their ice breakers to clear the ice in the lower Kennebec River in years when the ice jam flood potential was high.

Skunk_River_at_Augusta_-_large_fileIce breakup on the Skunk River

Greg Stewart, data section chief for the USGS New England Water Science Center, said its part of the agency’s job to monitor river flows throughout the state of Maine and to measure the stream flow underneath the ice.

USGS technicians take ice cores to measure ice thickness at various places on the rivers. In order to make an ice measurement, it’s necessary to drill between 25-30 holes in the ice. Then, thickness is recorded at just several of the holes to help document the measurement conditions.

That information allows the USGS to assess the risk of ice jams, flooding or other problems when the ice begins to melt, Stewart said. According to Stewart, when ice jam flooding starts to happen, there is very little time and very little warning.

Thickness of the ice and how fast a melt occurs affects the ice jam flooding potential. For example while the weather is cold, and the water is freezing you have ice accumulation. When the weather changes and it starts to warm the ice begins to melt and begins to break up. A quick warmup with the ice strong and still in place can cause significant ice jam flooding.

Another sign of spring is the melting snowpack, which is the result of accumulated layers of snow with generally more at high altitudes. Snowpacks feed rivers and streams providing an aquatic life habitat, hydro power, a possible source of drinking water, but they are also a potential flood hazard.

With a quick warm up of high temperatures over a short period of time, there is an increased likelihood of flooding from snowpack melt, but when you have a gradual increase in spring temperatures with moderate temperatures during the day and slightly below freezing at night the flooding potential is decreased slowly and safely.

According to Stewart, when the snowpack starts to melt, historically in March, that’s when snowmelt driven runoff begins and the USGS looks at the flooding potential.

To learn about the water levels at a streamgage near you sign up for alerts to your email or cell phone here!

Learn More:

Episode 6: Ice jams, flooding likely in Nebraska this spring, transcript: March 4, 2010

Thompson Bridge (Red River) Image Gallery

Ice Jam on the Niobrara River

Ice breakup at South Fork Grand River near Cash, SD

CATEGORIES: FEATURED, WATER

POSTED ON APRIL 9, 2014 AT 9:14 AM

LAST UPDATE 8:07 AM BY: HANNAH HAMILTON HHAMILTON@USGSGOV, ETHAN ALPERN EALPERN@USGS.GOV

ABC Reports: Construction Materials Prices Up 0.5 Percent in March

CEU2“Despite the increase in materials prices, this report does not signal a period of much higher inflation.” —ABC Chief Economist Anirban Basu.

PPI_4 11 14Construction materials prices expanded 0.5 percent in March and are up 1.1 percent from March of last year, according to the U.S. Department of Labor’s April 11 producer price index release. Nonresidential construction materials prices are up 0.4 percent for the month and are 1 percent higher than the same time one year ago.

“Despite the increase in materials prices, this report does not signal a period of much higher inflation,” said Associated Builders and Contractors Chief Economist Anirban Basu. “While it is true that there were significant increases in overall monthly inflation for both the broader economy and for construction, only a handful of categories were actually associated with a meaningful uptick in prices.”

Overall, the nation’s wholesale goods prices fell 0.1 percent in March but are up 1.7 percent year over year. Crude energy materials prices fell 6.8 percent in March but are still 13.6 percent higher than one year ago, and have expanded by 34.1 percent through the first three months of 2014.

“With respect to the broader economy, much of the inflation was related to food, which likely is a result of meteorological impacts,” said Basu. “With respect to construction, only three of 11 categories actually experienced increasing prices for the month. Given modest projections for both global and national economic growth, it is unlikely that significant inflationary pressures will be experienced during the month ahead with respect to most construction materials prices.”

The following materials prices increased in March.

Nonferrous wire and cable prices gained 0.1 percent in March but are down 2.7 percent from one year ago.

Concrete products prices expanded 0.3 percent in March and are up 3.9 percent from one year ago.

Prices for prepared asphalt, tar roofing, and siding expanded by 1.1 percent for the month and are up 0.1 percent from one year ago.

Eight of the 11 key construction inputs did not experience price increases for the month.

Iron and steel prices fell 1.7 percent in March but are up 1.3 percent from the same time last year.

Natural gas prices fell 10.9 percent in March but are 48.5 percent higher than one year ago.

Crude energy prices fell 6.8 percent in March but are 13.6 percent higher than one year ago.

Steel mill products prices shed 1.1 percent for the month but are 1.4 percent higher than one year ago.

Crude petroleum prices fell 6.4 percent in March but are up 3.9 percent from March 2013.

Prices for plumbing fixtures shed 0.8 percent for the month but are up 1.9 percent from the same time last year.

Fabricated structural metal product prices are down 0.2 percent for the month but have risen 0.5 percent from one year ago.

Softwood lumber prices fell 0.8 percent in March and are 2.1 percent lower than one year ago.

To view the previous PPI report, click HERE

ABC Reports: Jobs Report Meets Expectations In March

CEU2“The 6,700 nonresidential construction jobs added in March demonstrate the growth we expect in the second quarter of 2014.” —ABC Chief Economist Anirban Basu.

Employment_4 4The U.S. construction industry gained 19,000 jobs in March and the construction unemployment rate fell to 11.3 percent (non-seasonally adjusted), according to the April 4 employment report by the U.S. Department of Labor (DOL). Nonresidential construction segments added 6,700 jobs in March, a marked improvement from the 2,800 jobs (revised) added in February. The improvement led the construction unemployment rate to fall from 12.8 percent in February 2014 and 14.7 percent in March 2013.

The residential sector continued to build momentum, adding 9,100 jobs for the month. Heavy and civil engineering added 3,200 jobs in March and has added 22,100 jobs in the past 12 months.

“The 6,700 nonresidential construction jobs added in March demonstrate the growth we expect in the second quarter of 2014,” said Associated Builders and Contractors Chief Economist Anirban Basu. “The colder than normal winter has been particularly cruel to the construction industry, and its departure should bring accelerated job growth.

“While it is promising to see the construction unemployment rate shed more than a full percent in March, it remains well above pre-recession levels,” said Basu. “As spring finally settles in, the construction unemployment rate should return to the levels experienced in the third and fourth quarters of 2013 (approximately 9 percent).”

According to the Bureau of Labor Statistics’ household survey, the national unemployment rate remained unchanged in March at 6.7 percent as the country added a total of 192,000 jobs. January and February’s jobs reports also were revised upward by a combined 37,000 jobs.

“Although the unemployment rate remained unchanged in March, the labor force (those either employed or seeking employment) increased by 1.5 million in the first quarter of 2014 after falling by 500,000 in 2013,” said Basu. “Gains to the labor force will, at least in the short term, apply upward pressure on the unemployment rate. That said, given the number of jobs created, upward revisions to prior months and expansion of the average workweek, today’s jobs report should not be viewed as disappointing.”

Nonresidential building construction employment grew by 2,200 jobs for the month and is up by 14,000 jobs (2.1 percent) since March 2013.

Residential building construction employment rose by 3,100 jobs in March and is up by 547,800 jobs (7.9 percent) since March 2013.

Nonresidential specialty trade contractors gained 4,500 jobs for the month and employment in that category is up by 12,700 jobs (0.6 percent) compared to the same time last year.

Residential specialty trade contractors gained 6,000 jobs in March and have added 55,200 jobs (3.6 percent) since March 2013.

The heavy and civil engineering construction segment gained 3,200 jobs in March and job totals are up by 22,100 (2.5 percent) compared to the same time last year.

To view the previous Employment report, click here

ABC Reports:Nonresidential Construction Spending Inches Higher

CEU2“The conventional wisdom is that this year’s winter weather has suppressed spending and that will make the spring recovery even stronger than it would have been, as pent up supply is released.” —ABC Chief Economist Anirban Basu.

spending_4 1The U.S. Census Bureau announced today that nonresidential construction spending increased 0.6 percent in February and has risen 6.1 percent since February 2013. The gains follow nonresidential construction spending declines in both January and December. Spending for the month totaled $580.5 billion on a seasonally adjusted, annualized basis.

“February’s construction spending data is difficult to interpret, as was the case in December and January, because of the lengthy and harsh winter,” said Associated Builders and Contractors Chief Economist Anirban Basu. “The conventional wisdom is that this year’s winter weather has suppressed spending and that will make the spring recovery even stronger than it would have been, as pent up supply is released. However, the level of recovery in construction spending has not been enough to significantly improve pricing power and profit margins.

“In addition, based on ABC’s analysis of the Bureau of Labor Statistics Job Opening and Labor Turnover Survey (JOLTS), skills shortages impacting construction are becoming more commonplace, which also will place downward pressure on margins,” Basu said.

Spending rose in eight of the 16 nonresidential construction subsectors in February:

Communication construction spending increased 7.2 percent in February and is up 52 percent from the same time last year.

Highway and street-related construction spending expanded 1.3 percent in February and is up 11.4 percent compared to the same time last year.

Amusement and recreation-related construction spending increased 1.7 percent in February and is up 3.1 percent from the same time last year.

Lodging construction spending rose 2.9 percent in February and is 37 percent higher than the same time last year.

Health care-related construction spending increased 0.4 percent but is down 4.3 percent from the same time last year.

Office-related construction spending expanded 0.2 percent in February and is 12.9 percent higher than the same time last year.

Conservation and development-related construction spending rose 5.3 percent in February and is up 3.1 percent from the same time last year.

Power construction spending increased 4.7 percent for the month and is 11.4 percent higher than the same time last year.

Spending in eight nonresidential construction subsectors decreased in February:

Religious spending fell 7.3 percent for the month and is down 22.6 percent from the same time last year.

Education-related construction spending fell 1.1 percent for the month and is 22.6 percent lower than the same time last year.

Commercial construction spending fell 0.3 percent in February but is up 12.4 percent compared to the same time last year.

Public safety-related construction spending fell 7 percent in February and has declined 10.5 percent since the same time last year.

Sewage and waste disposal-related construction spending declined 1.9 percent for the month and is 5 percent lower than the same time last year.

Construction spending in the transportation category fell 1.2 percent in February but has increased 5.1 percent since the same time last year.

Spending in the water supply category was down 10 percent on the month and is 18.1 percent lower compared to the same time last year.

Manufacturing-related construction spending decreased 0.1 percent in February but is up 16.7 from the same time last year.

To view the previous spending report, click here