How cities are using billions in federal dollars to create good jobs

Over the past several months, manufacturing, tariffs, offshoring and reshoring have been at the forefront of national news coverage. This isn’t surprising.

Although manufacturing jobs have been on the decline since the late 1980s, manufacturing remains a crucial part of the American economy. In 2016, it accounted for 11.7 percent of GDP. On the other hand, American companies are having trouble filling many middle-skill jobs, which is expected to result in approximately 2 million manufacturing jobs going unfilled in the next decade.

Photo by Armando Aparicio

This and other topics were discussed at a recent Senate briefing organized by the non-profit Jobs to Move America, with support from Senator Chuck Schumer’s office on Capitol Hill. The event brought Democratic and Republican policymakers, as well as community and labor groups together for a common goal: To learn more about how federal infrastructure dollars are creating good jobs for working Americans.

Panelists included Amberrose Powers, a welder at the Kinkisharyo railcar plant in Palmdale, CA; Dr. Chauncy Lennon, Managing Director and Head of Workforce Initiatives, Global Philanthropy at JPMorgan Chase; John Porcari, President of Advisory Services at WSP USA and former Deputy Secretary for the U.S. Department of Transportation; Professor Scott Cummings of UCLA Law School; and Veronica Vanterpool, a board member of the NY MTA. The panel discussion focused on how the $2 trillion that US and local governments spend each year on public goods can be used to create good jobs for American workers using an initiative called the U.S. Employment Plan.

The takeaway? Good jobs and the future of manufacturing need to involve local and federal government.

From waitress to welder, and into the middle class

“This job changed my life. I was a waitress making almost nothing and now I have a good job that allows me to buy a car and live a decent life.” Those were the words of Amberrose Powers, a welder who described how the U.S. Employment Plan propelled her career in a new direction.

A few years ago, Powers was working as a waitress and struggling to make ends meet. She then got a job as a painter, but that only paid $11 an hour. When Kinkisharyo International opened a new factory to build rail cars for the LA Metropolitan Transportation Authority, she got hired as a painter there at a much better wage. She then trained to become a welder at the same factory, making $20.64 per hour. She described her work in a field dominated by men as requiring “thick skin,” especially since she is one of only two women out of 40 welders. Despite the challenges, she loves her job at Kinkisharyo, which employs over 400 workers building the signature yellow light rail cars traveling across LA’s rapidly expanding transportation system.

What does Amberrose’s experience have to do with federal infrastructure funding? Everything. The Palmdale, CA, factory she works at opened as a direct result of LA Metro’s use in 2012 of a new tool — approved by the US Department of Transportation — called the U.S. Employment Plan, which was the subject of the Senate briefing.

What is the U.S. Employment Plan?

The U.S. Employment Plan is a flexible toolbox of policy resources that public agencies can add to their contracts to encourage manufacturers selling them equipment to create good U.S. jobs in communities that need it the most.

The USEP includes three types of policy tools:

  1. Proposal planning tools that encourage manufacturers to describe the number and quality of U.S. jobs supported and commitments to hiring workers facing multiple and significant barriers through recruiting and training efforts.
  2. Evaluation tools that provide a range of scoring methods to help public agencies evaluate the quality of proposals submitted.
  3. Compliance and implementation tools in the form of contract and enforcement language and suggested programs that help winning contractors build strong workforce programs and also ensure transparency and accountability for the U.S. jobs commitments contained in the contract.

How has the U.S. Employment Plan been used?

To date, a version of the program has been adopted by seven leading transportation agencies, including the New York MTA, Los Angeles Metro, Chicago Transit Authority, Amtrak, the Massachusetts Bay Transportation Authority, and the Metropolitan Atlanta Regional Transportation Authority.

In New York, Governor Andrew Cuomo and the New York MTA incorporated a USEP for the purchase of 535 subway cars, a contract worth $1.4 billion. As part of the plan, Kawasaki, a Japanese-based company, has committed to building the cars in their facilities in Yonkers, NY, and Lincoln, NE, creating about 470 American jobs at a value of $125 million.

According to Veronica Vanterpool, the NY MTA board member who spoke at the briefing, the company is required to “have an internal cost accounting system that separates direct work hours and costs for this contract to verify information provided in the USEP.” If the USEP is not hitting targets, the MTA can assess liquidated damages for non-compliance.

Dorval Carter, President of the Chicago Transit Authority, and an early supporter of the USEP was also at the briefing. In his city, the railcar manufacturer that won a $1.3 billion contract has already constructed a new factory on the South Side of Chicago that will employ hundreds of permanent workers.

There’s progress, but more needs to be done

Workers are having a difficult time in this country. But it’s not all bad. There is an opportunity for cities and states to develop policies that maintain our infrastructure and ensure that our economy works for everyone.

The U.S. Employment Plan and other infrastructure-related tools, if used right, have the potential to change the lives of hundreds of thousands of workers across the country. With billions of federal, state and local infrastructure funds being spent, there is more that cities, states, and the federal government can do to create good jobs, build healthy cities and communities and benefit American workers like Amberrose Powers.