U.S. construction workers cheer stimulus dollars

WASHINGTON Tue Jun 2, 2009 7:07pm EDT

A construction worker takes part in a rally outside the KB Home headquarters in Los Angeles April 1, 2009. REUTERS/Mario Anzuoni

A construction worker takes part in a rally outside the KB Home headquarters in Los Angeles April 1, 2009.

Credit: Reuters/Mario Anzuoni

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WASHINGTON (Reuters) - Willie Fort is a lucky man. Last month he came within a whisker of losing his construction job, but now he is off to Louisiana to work on a highway project that will employ him for at least two years.

The 32-year-old father of four from Mississippi is among hundreds of construction workers who are either keeping their jobs or finding new employment as the U.S. government's record $787 billion package to jump-start the economy is slowly disbursed.

"I was quite thrilled and very shocked," Fort said with a chuckle. "There was nothing lined up, so there was a big possibility that I could have been laid off."

But his employer, Texas-based Austin Bridge and Road, bid for some of the stimulus-funded construction projects across the United States, saving Fort and several other employees from joining the country's growing ranks of unemployed.

"We were getting ready to lay off about two dozen people on a project in Mississippi and as a result of having picked up one of the stimulus projects in Louisiana, we offered them all jobs," said Jim Andoga, the company's president.

"We have not hired new people, but what this project did is to save 20 to 30 other jobs. The project is going to go into high gear in about three months and we are going to need to hire about 20 people more."

Not only has Fort avoided becoming a casualty as the longest recession since the Great Depression rages on, he also got a promotion.

"The job is going to require him to work a little further from home, but it's two years of steady employment. Last week we offered him a promotion to go there. He was the lead carpenter working on an hourly basis and we promoted him to foreman's position," said Andoga.

CONSTRUCTION HARDEST HIT

The construction sector has been hardest hit by the housing-led recession, which is now in its 18th month. According to Labor Department data, about 1.74 million construction workers were unemployed at the end of April.

The unemployment rate among construction workers slipped to 18.7 percent in April from 21.1 percent in March, but that's still more than double the national jobless rate of 8.9 percent. Job losses in the sector eased to 110,000 after declining 135,000 in March.

Contractors, companies and unions agree the massive stimulus package, criticized by some as mortgaging the country's future, was behind signs of improvement in the sector. The industry was allocated about $140 billion in federal dollars, mostly for work on highways and dams.

"Early reports indicate that the infrastructure piece of the stimulus is beginning to do exactly what was intended, to put construction workers back on the job," said Ken Simonson, chief economist for the Associated General Contractors of America in Arlington, Virginia.

Not only are hourly laborers getting a respite, but the improved economic tone is also benefiting white collar professionals, such as engineers and project managers.

Austin Bridge and Road has retained 12 to 15 white collar jobs. The company, which employs about 1,200 workers across the country, had been "getting ready to lay off in the neighborhood of 50 to 60 white-collar and blue-collar workers, but these jobs were saved because of the stimulus," Andoga said.

Some companies have begun rehiring workers they were forced to fire or adding new workers.

REHIRING LAID-OFF WORKERS

Rob Loch, owner of Loch Sand and Construction Company in Missouri, said he had rehired 15 laid-off workers after being awarded work to rebuild the interstate highway.

"We anticipate in the next couple of weeks several more hires as well. Without this job, none of these people would have been called back," Loch told Reuters.

In New Hampshire, Pike Industries hired 50 new workers and another 50 to 75 jobs were saved, spokesman Erik Taylor said.

"We have been hiring since March. People who got laid off in winter when work was slow were also recalled. We hope these will be permanent jobs; at this point we have a year to a year-and-a-half worth of work," said Taylor.

Jason Thornton is one of the new people hired by Pike Industries in April.

"Last fall is when I started looking around. I heard from the grapevine that Pike was looking for heavy equipment operators. It's great to be working again," said the 33-year-old father of four from New Hampshire.

"I know a lot of people who are working for some surrounding companies who will attest to the fact that the economy is terrible and the stimulus money, whether you are for or against it, has put people back to work."

AGCA's Simonson said about 85 percent of construction companies have indicated they were scrapping layoffs or adding new employees because of the stimulus funds.

The early signs of positive results from the package could score political points for President Barack Obama.

Some, including Austin Bridge and Road's Andoga, have set aside fears the the debt-funded effort, which is expected to help push the U.S. budget deficit to about $1.8 trillion this fiscal year, could actually hurt the economy. The White House projects a budget gap equal to about to 13 percent of gross domestic product, which would be the highest since 1945.

But home builders are yet to reap direct benefits from the stimulus. Groundbreaking activity for new homes has been running near a record low as a glut of unsold homes and tight credit force builders to put construction plans on hold.

"I would be surprised if there are too many home building concerns that are hiring back workers that were laid off as a result of the stimulus package," said Jerry Howard, president of the National Association of Home Builders in Washington.

However, he said he anticipated the stimulus plan, which has a $8,000 tax rebate provision for first-time buyers, would generate over 160,000 home sales this year.

(Editing by Eric Walsh)

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