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June 15th, 2011 NIGEL JAQUISS | News Stories
 

Not True, Times Ten

Gov. Kitzhaber and backers of a new I-5 bridge claim it will create 20,000 jobs. Their own numbers show how wildly wrong they are.

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Gov. John Kitzhaber wants Oregonians to believe he’s creating jobs, and he backs up that claim by promoting his support for the $3.6 billion Interstate 5 bridge project called the Columbia River Crossing.

On May 17, Kitzhaber sent a letter to the state’s most powerful business groups and the AFL-CIO, the umbrella group for trade unions, boasting about his effort to boost Oregon’s economy after helping unveil a new design for the bridge. “We took a major step forward on the Columbia River Crossing and the 20,000 new jobs its construction and long term improvements will create,” Kitzhaber wrote. (He got that figure from project sponsors’ modeling. See their memo at here.)

Just think of it—20,000 jobs. That’s three times the number of people Nike employs in Oregon, and more than Intel, the state’s biggest private employer. In a state where unemployment is well above the national average at 9.6 percent, that claim sounds like manna from heaven.

Except it’s not true—not even close.

Kitzhaber is exaggerating by 10 times the number of jobs potentially created by project, known as the CRC. That’s according to the project’s own reports, as well as the state’s methods for tallying jobs.

It’s not the first time that leaders from Oregon and Washington have made shaky claims to justify the project. The major reasons backers cite for building the CRC are disproved by the project’s own documents (see “A Bridge Too False,” WW, June 1, 2011).

At a time when creating jobs is the top priority of every policymaker in Oregon, the project’s potential is a rare bright spot for politicians seeking votes and a construction industry desperately seeking work. The claim of 20,000 jobs has gained traction, and the power of that number has built support for proceeding with the project, which would replace the existing I-5 bridge between Portland and Vancouver, fix seven major interchanges, and extend light rail to Vancouver.

In November 2009, CRC planners projected the number of jobs it would create. They found it would employ 12,421 construction workers over a 10-year period; it would create 2,964 “indirect” jobs—that is, jobs at companies that supply goods and services to the project but are not directly involved in building it; and it would spawn 5,589 “induced” jobs, positions such as bartenders and store clerks supported by the spending of those working on the project.

That all appears to add up to just over 20,000 jobs, spread over a decade.

But there’s a caveat: The way CRC backers tally jobs not only runs counter to how economists count jobs, it also ignores the way the state of Oregon itself counts them.

The state’s Employment Department counts net continuing jobs. It doesn’t allow a company—or state agencies—to count jobs by adding them up and then multiplying the jobs by the number of years.

So, in other words, if 100 workers pave a section of road, it counts as 100 jobs. Even if that paving takes five years, it still counts as 100 jobs—not 500.

And ignoring that rule is how CRC backers vastly exaggerate the economic value of the project.

According to the CRC’s own figures, the “average annual regional jobs” created is not 20,000, but 1,907—or less than 10 percent of the oft-cited figure.

WW shared the CRC’s job projections with Amy Vander Vliet, an economist for the Oregon Employment Department. She took no issue with the CRC study's projections.

But Vander Vliet says the way proponents are presenting employment prospects is wrong; the correct number should reflect how many workers are on the job at any one time.

“These jobs, because they are spread out over 10 years, would not show up in our figures as 20,000 jobs,” she says. “The number to focus on is the annual figure of about 2,000 jobs.”

Of course, 2,000 jobs would give Portland’s economy a boost. 

But exaggerating the project’s benefits has been a pattern among CRC backers, including Kitzhaber. As WW has reported, the project has overstated demand for a new bridge (its traffic projections are way off), the danger the current bridge poses (its claims about traffic safety are false), and the earthquake hazard presented by the old span (more than two dozen I-5 bridges are less stable, including the Marquam).

CRC backers have repeatedly invoked the 20,000 jobs estimate to build a broad coalition of supporters and steamroll doubts whether the project is even needed. 

The 20,000 number is so ubiquitous it actually appears in a toothless resolution, House Joint Memorial 22, which backers want the Legislature to approve to lend a slim degree of official support to the project. “Whereas the Columbia River Crossing Project would create 20,000 new and sustained jobs by providing improved access to ports and highways…,” the bill reads in part.

Brian Gard, who heads up the Columbia River Crossing Coalition, wrote in a March 15 Oregonian op-ed that the 20,000 jobs figure comes from “highly conservative estimates.”

Experts doubt that. “The way most of us are going to think about this is 2,000 jobs per year over the life of the project,” says Tim Duy, director of the Oregon Economic Forum at the University of Oregon. “If the question is, ‘Is this like creating a new Intel?,’ the answer is no.” 


FACT: Boston’s “Big Dig” tunnel, a 7.5-mile project completed in 2004, cost $14.6 billion (more than three times the original budget) but at its peak, according to Massachusetts DOT, never employed more than 5,000 workers.

 
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