POLITICAL ECONOMY RESEARCH INSTITUTE
CASE STUDY: BALTIMORE
In this case study, we estimate the employment impacts of various transportation infrastructure projects in the city of Baltimore. We are particularly interested in examining the differences in employment resulting from different project types: those that focus on bicycle and pedestrian infrastructure and those that do not. Using an input-output model, we evaluate project-specific data provided by the City of Baltimore. We find that pedestrian and bicycle infrastructure projects create 11-14 jobs per $1 million of spending while road infrastructure projects create approximately 7 jobs per $1 million of expenditures. Below we describe the projects we analyzed and present more detailed estimates of the employment impacts.
Project Descriptions and Data
We acquired data from the City of Baltimore for a variety of completed infrastructure projects. Included in these are footway repair projects, bike lane projects, and road repair projects. The footway repairs included excavation and concrete removal, repairing and replacing concrete sidewalks, repairing and replacing drainage systems, planting trees, constructing pedestrian ramps, and laying brickwork. The bike lane projects included signing and marking for on-street bike lanes as well as a planned bike boulevard which will include signing and marking as well as curb extensions, bollards, and planters. Road repair projects fell into two categories: the more basic re-surfacing jobs which entailed excavation, paving, and pavement marking; and the more elaborate road repair projects which also included more engineering work, drainage and erosion control, signage, and utility relocations.
For each project, the city provided us with expenditure data detailing the engineering, construction, and materials costs. We then used an input-output model to estimate the employment impacts resulting from these expenditures. For this case study, we used IMPLAN version 3.0 along with the 2008 Maryland data set for our analysis. The input-output (I-O) model allows us to assess the economy-wide impacts of various activities. In addition to the direct jobs that are created in the engineering and construction firms involved in infrastructure projects, jobs are created in the supply chain of these industries, which we call ‘indirect jobs.’ These indirect jobs are in industries such as cement manufacturing, sign manufacturing, and trucking. Furthermore, as workers in the direct and indirect industries spend their earnings, they create demand in industries such as food services and retail establishments, which we call the ‘induced effects.’ The I-O model captures not only the direct employment and output effects of an activity, but also the indirect and induced effects, and therefore provides a more complete picture of the impacts resulting from infrastructure spending.
About the Political Economy Research Institute
“The Political Economy Research Institute (PERI) promotes human and ecological well-being through our original research. Our approach is to translate what we learn into workable policy proposals that are capable of improving life on our planet today and in the future. In the words of the late Professor Robert Heilbroner, we at PERI ‘strive to make a workable science out of morality.'”