Dive Brief:
- Major engineering, design and construction companies reported strong revenues in the recent quarter as money from federal infrastructure legislation reached cities, states and transportation authorities, enabling them to sign contracts with these firms.
- AECOM, Jacobs, Parsons, Tutor Perini and WSP saw revenues up from 9% to more than 30% in the quarter, they reported.
- But even as contracts are signed and billions of dollars flow to transportation and other infrastructure projects, congressional wrangling over fiscal year 2024 federal budget appropriations could derail or delay construction.
Legislation passed since 2021, including the Infrastructure Investment and Jobs Act, Inflation Reduction Act and the CHIPS and Science Act, collectively authorized federal investments of nearly $1.9 trillion over a period of years and spurred additional investments from the private sector.
In testimony to Congress in March, American Road and Transportation Builders Association Chair Paula Hammond said that “more than 36,000 transportation improvement projects — including at least one in every congressional district — have moved forward in the past 16 months as implementation of the federal Infrastructure Investment and Jobs Act continues.”
The White House says these projects include clean water infrastructure, public transportation, intercity passenger rail, power grid upgrades, electric buses, roads and bridges, high-speed internet availability, infrastructure resiliency and projects to address legacy pollution.
These investments have been a boon for the companies that design and build those projects:
Parsons reported record organic revenue growth of 23% year over year in Q2 of 2023, with President and CEO Carey Smith stating on the company’s Aug. 2 earnings call, “We’ve got obviously a very strong $8.9 billion record backlog.”