Many of South Carolina's workers are hurting due to our average unemployment rate of 12.6% with some counties reporting up to 23.6%. MSNBC.com recently covered the hardest hit professions; it was no surprise to my colleagues that architecture was number one with 17.8% in job losses. Construction workers are right on our heels; the US Bureau of Labor and Statistics (BLS)reported that South Carolina construction jobs are down 16.3% in the last year. These numbers do not account for the self employed who have been under-employed for the past two years or the companies who have kept their employees but cut their wages.
In order for South Carolina to move out of this recession we need to put our large construction industry back to work. In reviewing Governor Sanford's 2010-2011 proposed budget, I could only find one capital improvement project for $15 million while there were over $ 900 million of requested funds for building projects. Our universities and public agencies have put new construction on hold and deferred maintenance for far too long. There has not been a Capital Bond Bill passed since 2001. Our legislators need to invest in our future by passing a Capital Bond Bill in 2010; we cannot afford not to have a Bond Bill passed.
Architects, landscape architects, planners, surveyors, civil engineers, geo-technical engineers, mechanical engineers, structural engineers, acoustical engineers, interior designers, general contractors, carpenters, mechanical contractors, roofers, masons, painters, cabinet makers, electricians, plumbers, insulators, laborers, building material manufacturers and suppliers, city planners, city building code reviewers and inspectors are some of the 24,000 jobs with $720 million in personal income that are created or sustained with each $1 billion in nonresidential construction spending. The state's Gross Domestic Product would increase by almost $2.3 billion.
At first glance, we can understand why our legislators are reluctant take on an ambitious spending program when our state economy is so weak and the current state budget is in deficit. Below there are four reasons we cannot wait to go to bond in 2011, 2012 or beyond.
1. Interest rates are at an all-time low
2. Construction companies are eager to work at very competitive prices
3. Our state economy badly needs a stimulus and
4. Fully employing our construction industry workers will boost state income tax receipts.
In good times, we can pay for capital projects in cash. In fact, we should. However, when the cash is not on hand, it makes sense to approve a bond. We can use our excellent "AAA" credit rating which gives us access to cash at low cost. Plus we can use the lull in the construction market to find qualified contractors at competitive prices. Construction projects will pump money into our economy. Finally, many of my colleagues' income has been so reduced in the past two years that they have paid almost nothing in state income tax. We all look forward to being busy and generating taxable income.
This is not an invitation to waste money. The bonds will be paid off with real dollars, when the recovery is realized. So each procurement dollar saved now is a tax dollar saved later.
But these projects, especially the deferred maintenance projects , need to be under construction sooner rather than later. An investment in infrastructure will be good for our economy now and good for the South Carolinians for many years to come.