Transportation CEOs Discuss IIJA, Inflation, and Workforce Challenges

What happened: CEOs of four top transportation construction, design, and materials companies Sept. 26 shared industry insights in an opening day panel at ARTBA’s annual convention in Nashville, Tenn. Topics covered: Infrastructure Investment and Jobs Act (IIJA); inflation; employee retention in tight labor markets; and inclusion, diversity and equity in the workplace.

Moderated by Caterpillar Inc.’s Group President, Industries, Tony Fassino, panelists were Summit Materials President & CEO Anne Noonan; Rogers Group President & CEO Darin Matson; AECOM Global Transportation Chief Executive Jennifer Aument; and Webber President & CEO Jose Carlos Esteban. (Pictured above, from left to right)

Why it matters: Transportation infrastructure remains a growth market in 2022 but is being buffeted by the challenges facing other sectors of the economy – rising construction and materials costs, supply chain bottlenecks, workforce issues and government requirements for climate change mitigation. CEOs offered the following insights:

• On the IIJA and coping with inflation: ‘Let’s be optimistic first,’ said AECOM’s Aument. ‘We’re fortunate as an industry to have a sustainable funding source (in the IIJA),’ though at the moment, ‘we’re seeing clients re-prioritize their programs.’ She said that AECOM is helping clients make adjustments to transportation projects to offset higher costs, streamline the permitting process, better manage risks on projects, and develop digital tools to help them ‘move forward in a complex environment.’ She noted that in a number of cases, the risk ‘pendulum’ appears to have swung on complex projects, resulting in a more reasonable burden for industry team members.
• On mitigating climate change: ‘Carbon reduction is our biggest focus,’ said Summit Materials’ Noonan, as is land reclamation. ‘We want to leave the land in better shape than when we got it,” she said. “It’s critical for us as an industry to take (climate change) very seriously.’
• On finding and retaining skilled talent: The labor shortage means workers can ‘just walk off the job and know they have another one down the road,’ said Rogers Group’s Matson. With 30 percent to 40 percent turnover ‘you never get fully staffed,’ he said. Applause followed when Matson called for immigration reform. ‘I could solve my labor problems,’ he said. ‘Give (migrants) a path to citizenship. That’s a problem we as an industry need to get together and solve.’
• On why equity and diversity is essential: The transportation sector is not only competing for talent from within, ‘we are also competing with other industries,’ said Webber CEO Esteban. ‘We need to figure out how to replace an aging workforce.’ A good Environmental, Social and Governance (ESG) profile can act as a magnet to help recruit younger workers, noted Noonan. ‘ESG can be value-creative,’ she said. ‘We need to be forward-facing.’