A new “report card” on U.S. roads, bridges, airports, power grid and other critical infrastructure gives the current state of national infrastructure a D+ average. The Failure to Act: Closing the Infrastructure Investment Gap for America’s Economic Future 2016 report from the American Society of Civil Engineers explains that over the next decade, it would cost more than $3.3 trillion to keep up with repairs and replacements, but based on current funding levels, the nation will come up more than $1.4 trillion short. When projected to 2040, the report continues, the shortfall is expected to top $5 trillion unless new funds are allocated.
Without that investment, Americans can look forward to more highway traffic jams, airport bottlenecks and potential power outages, the report notes. The deterioration of U.S. ports, roads, trains, water and electric facilities will also take an economic toll, the engineers write, cutting payroll growth by 2.5 million jobs and some $4 trillion of gross domestic product in lost sales and higher costs.
“America is currently spending more failing to act on its infrastructure gap than it would to close it,” says Greg DiLoreto, the society’s past president and chairman of the Committee for America’s Infrastructure. “Poor infrastructure means more congestion on our roadways, broken water lines and power outages, and an inability to get our goods to market.”
The 2016 study builds on models established in the 2011 and 2012 research, updating data and projections for infrastructure in five different sectors: surface transportation, water and wastewater, electricity, airports, and inland waterways and marine ports infrastructure. The analysis shows that in the years since the earlier reports, various state actions along with some federal funding measures have helped stabilize the infrastructure gap, but overall, underinvestment continues to negatively impact the U.S. economy.
The most significant gap, according to the report, is in the transportation sector, where an estimated $1 trillion is needed across the network—including roads, bridges and rail—during the next decade. For businesses, if the gap isn’t addressed, it may lead to increased production costs, increased cost of travel and decreased consumer spending. At home, it can lead to fewer jobs, lower incomes and more expensive infrastructure in the form of higher costs for transportation, electricity and water, DiLoreto explains.
The problem is certain to be in the national spotlight for at least the next few months. As CNBC reports, the funding gap has caught the attention of the three remaining U.S. presidential candidates. In a rare example of consensus, Republican Donald Trump and Democrats Hillary Clinton and Bernie Sanders all agree that the U.S. needs to make a substantial investment in rebuilding its infrastructure.
Sanders has proposed spending $1 trillion to create more than 13 million new jobs to rebuild highways, airports and other public infrastructure, noting that these “are jobs that cannot be shipped offshore or outsourced overseas,” CNBC reports. Meanwhile, Clinton wants to commit $275 billion in public funds over five years, including $25 billion for a national infrastructure bank to generate another $225 billion in direct loans, loan guarantees and other forms of credit. Finally, while Trump hasn’t proposed a specific funding level, he says he’s in favor of major public investment in infrastructure repair and expansion, CNBC reports.
What are your thoughts on either the current state of U.S. infrastructure or on the need for improvements? If the infrastructure continues to deteriorate, what impact will it have on your organization’s supply chain efficiency?