If the Georgia World Congress Center Authority and the Atlanta Falcons agree to a deal this year to build a new football stadium downtown, metro Atlanta’s construction industry may want to spike a football to celebrate.
From road builders to electricians to caterers, the proposed stadium could add nearly 30,000 direct and indirect jobs and buoy an industry that is still struggling to shake off the economic downturn.
But critics say the jobs created by the huge investment, which could range between $948 million and $1.2 billion, would only be fleeting. And some insist that hotel-motel funds collected in Atlanta and Fulton County shouldn’t be used to pay for the stadium, much less replacing an exisiting facility just 20 years old.
The construction industry has recovered slower from the Great Recession than other sectors, such as manufacturing and business services. The Associated General Contractors of America, a trade group, said the number of construction jobs in metro Atlanta fell 8 percent between August 2011 and August 2012 and many Atlanta-based firms are doing the brunt of their work elsewhere.
That’s why some in Atlanta’s business crowd are cheering the stadium long before it’s built. One expert, George Mason University professor Stephen Fuller, said a $1 billion investment in non-residential construction would create more than 14,000 construction-related jobs and another 14,000-plus jobs indirectly tied to the project. (He calculates about 9,700 jobs would be on-site, 4,600 from supplying construction materials and services; the rest would be created based on construction workers and their suppliers spending their income).
“We’re excited to hear about projects of this scope,” said Doug Rieder, who specializes in construction with the Sterling Risk Advisors insurance firm. “This would be a gigantic shot in the arm.”
For all the proponents, though, there remain non-believers who worry the stadium’s construction won’t have a lasting impact on Atlanta’s economy.
J.C. Bradbury, chairman of the Exercise Science and Sports Management Department at Kennesaw State University, said numbers predicting big gains from construction work have often been debunked, partly because the industry has always been fluid. That makes it difficult to claim that a stadium construction creates any jobs that aren’t fleeting.
“Construction workers just don’t sit on their hands,” he said.
Even though Fuller predicts the profusion of jobs, he has some doubt about the impact a new Atlanta stadium could have on the construction industry. He said he thinks that by 2014, construction employment will have rebounded and workers won’t be as plentiful as they are today, even in metro Atlanta.
How much of an impact the stadium project could have will depend on the final proposal, observers said. That includes the size of the facility itself, any added enhancements to differentiate it from other facilities, its location and the spillover construction it could spur for nearby attractions and amenities. Two sites are under consideration, one north of the Georgia Dome and the other south of the facility.
For construction companies, the possibility of a new stadium is welcome news. Unlike the 1990s and much of the 2000s when the metro area was dotted with cranes building hotels, office towers and swanky retail destinations, many of the city’s largest construction firms now have heavy equipment and work crews idling or working elsewhere.
“There hasn’t been that much large commercial construction here and a whole host of contractors are being underutilized,” said Rieder. “This could change that.”
It could also spur other types of development in the area, such as hospitality and nightlife ventures. At the minimum, it would require utilities to be rerouted and streets to be reconfigured to make way for the massive new structure. Atlanta Mayor Kasim Reed said in September that infrastructure needs could increase the project price to $1.2 billion, though he did not spell out how he derived that number.
“Folks want to locate near projects of that size, so there would likely be spillover construction for hotels, restaurants and infrastructure,” said Rieder.
That all sounds good in theory, observers said, but it doesn’t always happen in reality. One prime example of a sports project that failed to live up to its promise can be found just a few miles from the downtown sites that engineers are now studying for the Falcons.
When Turner Field was built as an Olympic venue in 1996, boosters vowed that the development would jump-start retail and businesses in a long-neglected corridor on the Southside of downtown. But 16 years later, there’s only one hotel (which predates Turner Field) and a handful of restaurants dotting an expanse of parking lots filled only when the Atlanta Braves are playing.
State Sen. Vincent Fort said he doesn’t think taxpayers should subsidize economic development projects, including construction jobs.
“I’m not convinced that stadiums bring the economic development that their advocates say they do,” said Fort, a Democrat who represents downtown Atlanta.
Boosters, though, say the sheer numbers can’t be denied and many point to the new Dallas Cowboys Stadium as proof.
John Dixon of Manhattan Construction, which had an $800 million contract to build the Dallas facility, said a total of 10,000 people worked on the site during the course of the 39-month project. All told, the construction firm spent $135 million in payroll and hired more than 450 vendors.
“We had to hire people to take care of the trash, office supplies, incidentals. And all those people came from the local market,” he said. “An array of industries get a spillover effect. Even when you bring in lunch for the guys whenever you have safety awards, you’d spend tens of thousands of dollars in local food service.”
Mike Dunham, chief executive officer of the Georgia chapter of the Associated General Contractors, said it’s hard to downplay the impact a similar project would have in Atlanta.
“A project of this magnitude would have the ability to help a whole lot of people,” he said.