Not all jobs are created equal

In the course of my job I get to spend an exhorbanate amount of time on I–95 between Richmond and DC. At best, it’s a mildly unpleasant experience. At its worst, it can be downright painful.

As I was stopped in construction traffic yesterday, I was thinking about all of the jobs that infrastructure construction and development creates. Whether at the state or federal level, infrastructure projects are always touted as significant jobs creators. The question I was pondering in traffic was not whether it creates jobs, but whether it creates the “right” kind of jobs and whether the jobs it does create have a positive or negative impact on the state’s bottom line.

The underlying assumption in my question is that not all jobs are created equal. In any society, there will be some job owners that contribute more into the system than they pull out. There will also be some job owners that contribute less into the system than they pull out. The vast majority, however, fall into a band in the middle where its pretty much a wash. Plot it on a graph and it looks like your standard bell curve.

To give you an example of how this may work out, consider two workers – Bob and Jim. Both guys have a full time job that pays $50,000 per year and they both pay roughly the same amount of taxes each year. Bob works from home, is healthy and has no kids. He takes very little from the system that he pays into. Jim, on the other hand, has 5 kids in the public school system, drives 50 miles to work each day, has chronic heart issues and draws unemployment insurance every 2 years when he is inbetween jobs. Jim, most likely, takes more from the system than he contributes. Both guys are employed making the same salary, paying the same amount of taxes. But Bob is clearly the more desirable “job” to create.

It would be a very interesting piece of research to look at the types of jobs that an infrastructure project creates and then see if those job owners are, typically, givers into or takers from the system. It would also be interesting to consider how long those jobs stick around after the initial construction phase of the project. That is, how many of those created jobs are durable.

I haven’t done the research, so I’m just speculating… But, what if the jobs that we create through infrastructure projects are short term in nature, AND are those job owners are “takers” from the system? Would we still tout infrastructure as the great job creator? How would that change policy decisions to know that adding the next “infrastructure job” would cost the system $8,000 per year, rather than provide a net benefit?

Conversely, what if we found out that infrastructure projects created lasting, durable jobs and the job owners were net contributors to the system?

Who knows what the research would show. I guess that’s why you actually do the research… If you’d like us to take a look at your state data and do this analysis, we’d be happy to do it – just give us a call!