10/4/2021—As the global health crisis of COVID-19 continues, the American economy strives to regain its footing. In response, the Biden Administration unveiled the American Rescue Plan (ARP) in March 2021, a $1.9 trillion monetary assistance plan for both state and local governments, small businesses, schools and individuals. Within the construction industry, the ARP has numerous benefits both directly and via a trickledown effect. Knowing the ways in which the ARP could benefit the construction industry is vital to keeping construction thriving.
For small or start-up construction businesses, the ARP can be used directly to provide funds through small business tax credits, emergency capital investments and paycheck protection.1 Through December of 2021, the Employee Retention Credit (ERC) helps businesses offset their payroll tax liabilities by up to $7,000 per employee per quarter. The ARP also established the Paycheck Protection Program (PPP), which helps small businesses pay up to two months of payroll, plus benefits. The PPP funds can also be utilized to pay interest on mortgages, rent and utilities for small businesses as well. Assistance funds for small businesses can also be used for enhanced safety and productivity management, such as CoRe Connect Resources smart badges, which can help ensure staff health and productivity are protected.
Another major benefit of the ARP is from assistance to other industries, as well as state and local governments. For example, $1 billion in funds was announced by the U.S. Department of Health and Human Services (HHS) in April of 2021. These funds are intended for Health Resources and Services Administration (HRSA)-Health Center Program funded health centers to support major construction and renovation projects across the country.2 With this allotment of funds, the construction industry will see a rise in jobs, as health facilities aim to renovate and build. “As the pandemic has made clear, modernizing the physical infrastructure of many of our country’s health centers is long overdue,” said HHS Secretary Xavier Becerra. “This latest American Rescue Plan funding will enable these vital community institutions that serve some of our most vulnerable populations to build state-of-the-art facilities.”2
Along with healthcare, state and local governments are receiving funding from the ARP to continue developing new buildings and improve infrastructure. The ARP allotted a whopping $365 billion directly to state, local, territorial, and tribal governments for infrastructure projects improving transportation, water, sewer, and broadband networks. Funds will remain available through the end of 2024.3 With the tremendous flow of funds going to key infrastructure and building improvements in every state, construction is predicted to see an upsurge in job availability and growth, as demand rises, which will continue through 2024.
The job growth doesn’t stop there, as the ARP also announced the Restaurant Revitalization Fund (RRF), specifically for restaurants all over the U.S. affected by COVID. These funds allow for restaurants to reopen, and permit restaurants to use funds for maintenance and building projects, including infrastructure improvements and the construction of outdoor eating spaces. Yet another example of the job growth that is predicted in construction from the ARP.
With new job opportunities resulting from the ARP funds, it’s no surprise that, according to the fourth quarter 2020 Global Construction Survey, the construction industry in the U.S. is expected to grow by 15.6% to reach $1,515,659.4 million in 20214, with growth continuing through the next 2 to 3 years. As can be seen, how the ARP affects construction is a complex topic, as it can aid both directly and indirectly, and it’s clear that regardless of how assistance is applied, the ARP will benefit the U.S construction industry exponentially over the next few years.
Ensure your business is ready to take on any project by making the safety and productivity of your employees a top priority. As you strive to provide your business with the best in protection and productivity, CoRe is honored to provide top-of-the-line technology via our smart badges. Contact us today to learn more!
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1 Assistance for small businesses. U.S. Department of the Treasury. (2021, April 13). Retrieved October 4, 2021, from https://home.treasury.gov/policy-issues/coronavirus/assistance-for-small-businesses.
2 Division, N. (2021, April 27). HHS announces $1 billion from American rescue plan for construction and renovation projects at Health Centers. HHS.gov. Retrieved October 4, 2021, from https://www.hhs.gov/about/news/2021/04/27/hhs-announces-1-billion-dollar-from-american-rescue-plan-for-construction-and-renovation-projects-at-health-centers.html.
3 Patterson, T. (2021, June 8). The American Rescue Plan Act and the construction industry. Texas Construction Law Blog. Retrieved October 4, 2021, from https://www.texasconstructionlawblog.com/2021/06/whats-new-in-the-world-of-stimulus-relief-a-discussion-of-american-rescue-plan-act/.
4 Markets, R. and. (2021, June 28). The US construction industry is projected to grow by over 15% in 2021 despite near-term challenges. The US Construction Industry is Projected to Grow by Over 15% in 2021 Despite Near-Term Challenges. Retrieved October 4, 2021, from https://www.prnewswire.com/news-releases/the-us-construction-industry-is-projected-to-grow-by-over-15-in-2021-despite-near-term-challenges-301321090.html.
American rescue plan (ARP) infrastructure funding – here’s what communities need to know. WGI. (2021, August 25). Retrieved October 4, 2021, from https://wginc.com/american-rescue-plan-infrastructure-funding-state-local-fiscal-recovery-fund/.
