Investing in Public Services Spurs Economic Growth

In Prioritizing Approaches to Economic Development in New England, researchers provide ample evidence that repairing infrastructure and improving education are effective approaches for creating jobs and generating economic growth.

By necessity, infrastructure repairs employ local workers and use local materials. Fixing roads, bridges, dams, energy transmission systems, drinking water systems and wastewater treatment meet real needs and directly create jobs.

The need is increasingly urgent. Evidence reviewed by the researchers shows that 40% of bridges in New England region are structurally deficient; 80% of the region’s dams present significant hazard; most of our roads are in poor or mediocre condition; and drinking water infrastructure is in need of $12 billion worth of repairs and renovations. The Midwest is similar in that much of its earlier investment in infrastructure now is aging.

The study also highlights how high quality education has become a requirement for accessing good jobs and developing a productive work-force in modern economies.  Education and training help individual students and workers by increasing their skills and giving them opportunities to achieve higher earnings, the authors write.

The researchers go on to describe how, instead investing in public structures and education, state policymakers are too often turning to corporate tax breaks to lure businesses to their state and public subsidies for employers who promise to hire workers in the state. These policies have been tried for decades, but the study presents the clear evidence that these tax subsidies don’t work to create jobs or revitalize state economies.