Two-thirds of the economic benefits and jobs created by federal highway and transit investment occur in non-construction sectors according to a new IHS report. The report also found that every dollar invested through the federal Highway Trust Fund in state highway, bridge and public transit programs returns 74 cents in tax revenue.

The report found that 70% of the economic benefits from infrastructure investment benefit non-construction sectors like business, education, health and leisure, and hospitality. Over 60% of jobs created by those investments are also non-construction.

“The study shows that investment in transportation infrastructure has a positive impact on every major sector of the U.S. economy,” said Karen Campbell, senior consultant at IHS. “These far-reaching economic benefits contribute to economic growth by improving the nation’s capital stock.”

By improving capital stock, it becomes possible to have an increase in economic activity, she added.

The current federal highway and public transit investment, which totals about $50 billion annually, generates an average of $31 billion in personal income tax receipts per year and $6 billion in federal corporate tax receipts. These numbers translate to around 74 cents of return on every dollar invested.

The report also linked increases in the nation’s GDP as well as personal income to transportation investment. Using the data IHS collected, the report also made predictions about what a 5% yearly increase to infrastructure investment could do.

IHS predicts that the annual increase could create between 78,000 and 122,000 new jobs by 2019. There would also be an additional $9.6 billion added to the nation’s GDP and a $4.9 billion increase in tax revenues to all levels of government.

Pete Ruane, the president and CEO of the American Road and Transportation Builders Association and co-chair of the Transportation Construction Coalition, hopes the IHS study will insight congress to improve the Highway Trust Fund.  

“This one policy area where Congress’ involvement could actually yield meaningful and long lasting economic results,” said Ruane. “Our message for congress is simple: Find a permanent solution for the Highway Trust Fund.”

The study was commissioned by the Transportation Construction Coalition which is made of 31 associations and labor unions that support strong federal surface transporation investment.  To read the full report, click here.

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