Infrastructure inadequacies will stifle U.S. economic growth, cost each American household $3,300 a year, cause the loss of $10 trillion in GDP and lead to a decline of more than $23 trillion in business productivity cumulatively over the next two decades if the U.S. does not close a growing gap in the investments needed for bridges, roads, airports, power grids, water supplies and more, according to a new economic study.
The report from the American Society of Civil Engineers (ASCE), "Failure to Act: Economic Impacts of Status Quo Investment Across Infrastructure Systems," finds that continued underinvestment in infrastructure and the resulting inefficiencies will have a cascading effect on the economy.
Major sectors like manufacturing, health care, housing, food services and more would also be harmed, the study said. The report finds that U.S. manufacturers are especially vulnerable to underinvestment because the production of goods -- such as cars, chemicals, foods and metals -- requires energy, water, transportation systems and ports for those goods being shipped, including to international markets. If the infrastructure investment gap is not closed , the report says U.S. exports will be reduced by $2.4 trillion and the country will lose $4 trillion in trade, which will cause the national trade deficit to balloon by $626 billion by 2039.
Jobs losses nationally will amount to 3 million in 2039. The report estimates about 47 percent of the jobs lost in 2039 will be high-wage and high-production jobs including manufacturing, finance, insurance and real estate, professional services and health care.
Between now and 2039, the ASCE report estimates that nearly $13 trillion is needed across 11 infrastructure areas: highways, bridges, rail, transit, drinking water, stormwater, wastewater, electricity, airports, seaports and inland waterways. With planned investments in infrastructure currently totaling $7.3 trillion, that leaves a $5.6 trillion investment gap by 2039.
The report finds that the infrastructure investment gap persists. The investment gap for surface transportation investment continued to grow from the previous study in 2016 -- from $1.1 trillion over 10 years to $1.2 trillion over 10 years. In some areas, increased investments from the federal and state levels have helped shrink the investment gap or hold it steady, including in inland waterways, ports, and to a lesser extent, aviation. However, in the areas that are most recognizable to Americans -- water, wastewater and surface transportation -- the nation is falling further behind.
However, the report says that most of the economic declines from worsening infrastructure -- particularly those forecast from 2030-2039, when projected impacts exponentially escalate -- can be prevented with prioritized investments. These investments will safeguard against:
- 80 percent of gross output losses, or $18.8 trillion. This is about three times the manufacturing industry's gross output in 2019.
- 79 percent of GDP declines, or $8.1 trillion. This is more than two times Germany's annual GDP in 2019.
- 78 percent of disposable household income losses, or $7.6 trillion. This is half the total combined disposable income of all Americans in 2019.
For more information, visit www.asce.org/failuretoact or call (800) 548-2723.
