On November 15, 2021, President Joe Biden signed the bipartisan Infrastructure Investment and Jobs Act (IIJA) into law. The new law will invest $1.2 trillion in rebuilding crumbling roads, bridges, and public transportation systems; supporting advanced energy technologies and clean water infrastructure; closing the digital divide; and modernizing the electric grid. These investments will create hundreds of thousands of good construction and manufacturing jobs that pay decent wages and benefits; are located in the United States; and have the potential to increase access for women, workers of color, and LGBTQI+ Americans.
The United States urgently needs more high-quality jobs. While the tight labor market is pushing employers to increase wages across the private sector and unionized workers are increasingly leveraging their collective power to demand better work, these temporary pressures are not enough to overcome decades of wage stagnation and worsening work conditions. Recent analysis from the Economic Policy Institute finds that while net productivity grew by nearly 62 percent over the past four decades, average hourly pay for the typical worker increased by just 17.5 percent.
The Build Back Better Act will create jobs and raise standards for workers in child care, home care, renewable energy and energy efficiency deployment, and electric vehicle production.
While the IIJA’s job quality standards will provide immediate benefits to American workers across the construction and manufacturing industries, further action is needed to improve the lives of workers in fast-growing sectors outside the construction industry. The Build Back Better Act is an essential complement to the infrastructure package. The legislation will create jobs and raise standards for workers in child care, home care, renewable energy and energy efficiency deployment, and electric vehicle production, as well as help make new protections real by funding agencies with key oversight roles and strengthening penalties for corporations that violate workplace laws. Together, the Build Back Better Act and the IIJA can also help sustain the pressure on employers to pay more to and do better by their workers.
Specifically, the Infrastructure Investment and Jobs Act will improve job quality by guaranteeing that new jobs pay decent wages and benefits, creating pathways into good jobs for all Americans, and creating these jobs in the United States.
1. Guaranteeing new jobs will pay decent wages and benefits
The federal government has long held that jobs created through government spending must pay decent wages and benefits. Ninety years ago, Congress enacted the Davis-Bacon Act to set wage and benefit rates for construction workers supported through federal contracts at existing market levels and ensure that low-road contractors could not undercut the market by paying poverty wages. These prevailing wage standards apply to many existing spending programs. Unfortunately, they do not automatically apply to new spending programs; Congress must take additional actions, as it has done several times in recent years.
The “overwhelming majority” of IIJA funds will be covered by the worker protections of the Davis-Bacon Act. This includes billions of dollars to support investments in advanced energy technologies that will help raise standards for workers in these fast-growing industries while also taking steps to combat climate change through programs to build new charging infrastructure for electric vehicles, support clean water infrastructure, and reduce truck emissions at port facilities.
2. Creating pathways into good jobs for Americans from all walks of life
A registered apprenticeship combines classroom instruction with paid on-the-job training. Employers in the construction industry frequently partner with unions to adopt apprenticeship programs that provide a steady pipeline of highly qualified workers. For workers, earning a nationally recognized credential through apprenticeship leads not only to high-paying jobs but also to opportunities for career advancement. Yet for too long, women, people of color, and workers with disabilities have been excluded from these jobs.
The infrastructure package has the potential to significantly expand pathways into good jobs for all working people.
The infrastructure package has the potential to significantly expand pathways into good jobs for all working people through training programs that recruit and policies that can increase demand for underrepresented workers. For example, the IIJA will support the creation of training centers for the installation and maintenance of energy efficient building technologies run in partnership with employers and labor unions; allow the use of surface transportation funds for the establishment of registered apprenticeship or preapprenticeship programs; and permit cities and states receiving federal funds to establish local hiring programs with economic or geographic preferences. These reforms build on the innovations adopted by cities and states in partnership with labor and community organizations that have established targeted hire, apprenticeship, and preapprenticeship programs that provide well-qualified workers for publicly supported projects and ensure that historically disadvantaged residents—such as women, people of color, low-income residents, LGBTQI+ individuals, disabled workers, and residents with past involvement with the criminal justice system—have access to these jobs.
3. Create jobs in the United States
All too often, laws designed to ensure that the federal government purchases American-made products and that federally supported construction projects use American-made inputs are poorly enforced and cover only a limited number of spending programs and end products.
Beyond the IIJA’s direct support for the domestic manufacturing of thousands of new railcars, battery electric buses, and ferries, the law will correct longstanding problems that have undercut American manufacturing by strengthening domestic content requirements for receiving financial assistance for infrastructure included in the bill and for future spending. For example, the IIJA strengthens the requirements that iron and steel have to meet to qualify as being produced in the United States, makes several other types of construction materials subject to these standards, and strengthens origin standards for manufactured products. Moreover, it will correct the previous abuse of waivers to get around content requirements and introduce transparency to the process; direct an assessment to be made of all existing free trade agreements and the World Trade Organization’s Government Procurement Agreement regarding the operation of Buy American laws; and require, by statute, the establishment of a Made in America office within the Office of Management and Budget to guide agencies to avoid misuse of waivers, among other efforts.
The IIJA has the potential to improve the lives of working people across the country. The Biden administration can help the law live up to its potential by issuing clear regulations and guidance to ensure that beneficiaries understand these requirements; encouraging innovation to attract workers from all walks of life to these jobs; and fully enforcing new workplace standards. Moreover, by advancing the Build Back Better Act in tandem with the IIJA, Congress can support workers across a variety of clean energy and caregiving sectors and help rebuild their power in the labor market.