Study Confirms EDA Construction Investments Build Stronger Communities

EDA investments in construction projects led to both establishment and job growth for neighborhoods, according to a new Urban Institute report.

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July 30, 2024

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EDA commissioned the Urban Institute to conduct an independent analysis on how EDA investments contribute to economic growth. Their newest report, "Local Impacts of Economic Development Administration Construction Investments," examines economic development outcomes in areas that received EDA grant awards since 2010. It finds that, during the five-year period ending in 2015, EDA construction projects represent remarkable return-on-investment for American taxpayers.

Three key findings, which can be explored in depth in their reporting, are:

1. EDA investments in construction projects led to both establishment and job growth for neighborhoods;

1. The average county saw an increase in jobs and higher median incomes following EDA investments;

1. At the county level, facilities and transportation projects are associated with significant employment growth, while utilities projects are more associated with growth in the number of establishments.

"This independent analysis of the impact of Economic Development Administration investments underscores the efficiency of EDA's model of place-based, bottom-up investing in communities," said Alejandra Y. Castillo, Assistant Secretary of Commerce for Economic Development. "From new roads, bridges, and pipelines that help grow a region, to investments in job creation, education, disaster recovery, and new technologies that transform a nation, EDA has brought billions of dollars to communities large and small across America."

The study also found that EDA grants typically benefit communities most in need, reflecting EDA's commitment to equitable investing. According to the report, counties that receive EDA investment in construction have lower median household incomes prior to the grant award, as well as higher poverty rates, lower median home values, and higher vacancy rates.

"This newest study adds to a growing body of research into EDA's grantmaking programs, the bureau's history and goals, the attributes of communities receiving EDA investments, and the extent to which EDA investments spur local economic growth," explained Sarah Rosen Wartell, President of the Urban Institute. "It will help inform policy discussions around federal support for local economic development."

An archive of past Urban Institute reports on the Economic Development Administration is available at eda.gov.