Dive Brief:
- President Donald Trump emphasized his infrastructure spending plan during his address to Congress Tuesday night, but he did not add new details about the massive funding program.
- Trump reiterated that he plans to introduce legislation to Congress that would approve $1 trillion toward the construction of roads, bridges, rail lines and airports — funded through public and private channels — but didn't offer a timeline for the proposal.
- He said the infrastructure program will be guided by two main principles: "buy American" and "hire American."
Dive Insight:
The construction industry continues to be optimistic that the new administration will bring a surge in business through its proposed infrastructure spend, despite uncertainty regarding its details. Last month, reports emerged that Trump might delay the legislation until 2018 as his team focuses on other key issues this year.
However, Kevin Wayer, international director and co-president of JLL’s Public Institutions group, told Construction Dive that Tuesday's speech signaled that Trump isn't "letting off the gas pedal" regarding his infrastructure promises, with the focus on public and private infrastructure investment being a key component of the address.
Trump first announced his infrastructure plan in October, which involves trading an 82% tax break for private equity investment in revenue-generating infrastructure projects over a 10-year period.
The renewed emphasis on rebuilding U.S. infrastructure has energized the construction industry, as a lack of steady federal funding has left many contractors uncertain about when their next projects will start. However, the continued absence of a timeline for the proposal could reignite previous frustrations of contractors hoping for a greater sense of stability in the project pipeline.
"Buy America" requirements — as mentioned during Trump's address — are a source of debate among construction industry groups, as some claim that the rules intended to help American manufacturers and suppliers could increase material costs for construction companies. Trump's "hire American" statement also raises further questions for the industry, as undocumented immigrants make up roughly 13% of U.S. construction workforce, which is already struggling to staff projects amid a severe labor shortage.
