The Associated Press (AP) gets an "Incomplete" grade overall on its January 11 article, "Road Projects Don't Help Unemployment," and an "F" on presentation for potentially, if unknowingly, misleading policy makers and the general public. That obviously occurred as the "Wall Street Journal" referenced the AP "conclusion" in a January 12 opinion piece.

The AP reported that it looked at the correlation between American Recovery and Reinvestment Act (ARRA) - "stimulus" - funds put toward transportation projects over the past 10 months in some specific local areas and the local unemployment figures over this time frame. It concluded "a surge in spending on roads and bridges ... has had no effect on local unemployment and only barely helped the beleaguered construction industry."

If only it were that simple.

Unfortunately, as most economists and business people know, many factors go into employment decisions, among the most basic, a firm's existing capacity to take on new work and the potential, or reality, of obtaining new work to pay personnel and overhead. The truth is ARRA funding - as ARTBA members and economists have testified to Congress - has been the lifeline that has, thus far, kept much of the industry afloat during the economic downturn. To understand and appreciate this impact, however, one must understand what drives the transportation construction market and look at more than two sets of data points.

Public investment finances about 95 percent of all transportation capital investments - construction projects - each year in the U.S. And normally, between 40 and 45 percent of that investment comes from the federal government, the remaining half from state and local governments.

So what happened with these funding sources during the past year? Well, the federal government, through the core federal highway and transit aid program to the states and the ARRA funds delivered record-level transportation funding to state and local governments.