The U.S. has made a dangerous shift to a low-wage economy where people of color disproportionately hold low-wage jobs. Coupled with an expanding Job Gap in many states, Jobs created by infrastructure investments generally pay relatively well and are accessible to individuals without a college education. Adhering to federal contracting rules and can ensure an increase in the number of living wage jobs available for everybody.
Building highways, bridges, and tunnels creates jobs– good jobs– jobs that put food on the table, and money in the pockets of those who desperately need it.
In a recent report released by the Economic Policy Institute, Algernon Austin explains the need of infrastructure investments to generate jobs. Nationally most experts estimate that an additional 9 million jobs are needed to reach unemployment levels seen prior to the recession. Mr. Austin finds that number doesn’t account for Blacks and Latinos. The U.S. needs to create 1.5 million additional jobs to contend with higher unemployment in these populations.
The Federal Department of Transportation is tasked with continuing the program of bringing jobs to states in need of road, and highway improvement. Each year, federal tax money is funded to states nationwide to perform construction projects. The success seen in the 1930’s of job creation and economic stimulation at the state level continues; however, race discrimination prevents minority business owners and women of taking advantage of construction project opportunities.
Accordingly, to even the playing field, the U.S. Department of Transportation’s DBE (disadvantaged business enterprise) program was created to provide a vehicle for increasing the participation of minority business enterprises in state and local procurement. When protections are adequately in place to ensure inclusion of those historically left out of economic opportunities, jobs are created, and people are able to work.
According to the Economic Policy Institute, 6.8 percent of the Hispanic labor force works in construction, compared with 4.1 percent of the white labor force, and just 2.1 percent of the black labor force. The Hispanic labor force also has the highest rate of involvement in transportation and material moving occupations, at 11.7 percent; African Americans have the second-highest rate, 10.1 percent, and whites have 6.7 percent (figure A, 2013, at 7). Accordingly, proposals that increase the demand for construction and transportation work produce a significant share of jobs for DBE’s.
Department of State Transportation regulations require state and local transportation agencies that receive federal assistance to establish clear goals for the participation of minority and women disadvantaged businesses. Through hard-fought civil rights legislation, the DOT office became the watchdog of ensuring minority and women owned businesses weren’t left out in the cold of economic opportunities.
History teaches us that when done correctly, construction jobs keep communities of color employed with livable incomes; however, when government turns a blind eye to using this valuable tool to create opportunities for ALL people to economically benefit, such omission becomes a sin.
Washington State Department of Transportation has recently been found ‘guilty’ of the sin of omission. Washington State received $1.4 Billion in federal funds to replace the Seattle viaduct. A recent federal investigation by the civil rights office within the U.S. Department of Transportation found that the WADOT failed in its oversight responsibility to ensure that the primary contractor on the project, Seattle Tunnel Partners, used good faith efforts to subcontract to women and minority owned businesses. The goal for inclusion was set at 8%, or allocating $19 million for DBE businesses. After completing nearly thirty-three percent of the project, Seattle Tunnel Partners has included less than 1%– that’s only $7 million toward DBEs.
Everyone loses when government fails to protect against discrimination. Placing $19 Million into the hands of minority business owners who have traditionally possessed decreased purchasing power is a positive win for everyone.
$19 million allocated to minority businesses could have:
- Created job opportunities for people of color plagued with higher rates of unemployment.
- Decreased the expanding racial wealth divide we’ve seen over the past decade.
- Changed the lives of individual business owners and of families earning livable incomes..
History shows us how well this worked in pulling America out of the debilitating grasp of Great Depression where under President Hoover, construction jobs put America back to work. It worked then, and can work now—if done right.
[The Alliance releases an annual study on the ratio between job seekers and the actual number of living wage jobs available. Our 2013 Job Gap Report will be released on December 3, 2013.]