November 2011
October 25, 2011

Pension assets used to create jobs

Author: Clarisse Butler Banks
Source: NYSUT United

Since committing up to $10 billion in private and public pension funds to create jobs by investing in infrastructure projects, a partnership that includes the AFL-CIO, the American Federation of Teachers and National Education Association is already off to a good start.

In New York City, the AFL-CIO Housing Investment Trust (HIT) is funding a $134 million energy efficiency and asbestos removal project.

And the AFL-CIO has issued a request for proposals for a $3 million energy efficiency retrofit of its headquarters in Washington, D.C.

"We know America wants to work. And we can't wait for Washington," said Richard Trumka, AFL-CIO president. "We look forward to working together to see that workers' capital is invested profitably in rebuilding our country."

Indeed, the AFL-CIO trust has created more than 10,000 union construction jobs during the past two years and has used investments of union pension capital to generate nearly $2 billion of economic activity. It's part of a growing movement of putting public and private pension assets to work to create jobs.

In June, a broad coalition chaired by the AFT, and including Service Employees International Union (SEIU), American Federation of State, County & Municipal Employees (AFSCME), International Association of Fire Fighters (IAFF), the AFL-CIO Building and Construction Trades Department and investment funds affiliated with the labor movement, announced a commitment to work with other partners to help put Americans back to work.

The AFL-CIO, working with the coalition, pledged to invest $10 billion in job-creating infrastructure as well as at least $20 million in specific energy retrofits over the next year; the pledge extends to training tens of thousands of workers as well.

"Public employees, unions, investment groups and others want to be part of a renewed America," said AFT President Randi Weingarten. "What we're talking about today is America's retirees, and future retirees, helping their country recover economically and invest in projects that might never have gotten off the ground because of budget crises."

Weingarten said the AFT has been working for more than a year with a committee of union leaders in an effort to invest public pension fund assets in job creation. Two of the nation's largest public pension funds — the California State Teachers' Retirement System and the California Public Employees' Retirement System — have committed to investing up to $800 million in their state's infrastructure projects. Similar talks are also taking place in New York.

"We have seen so much finger-pointing and scapegoating directed at public employees and unions," Weingarten said. "The commitments by public pension funds show that public employees are focused on solutions in a fiduciarily sound way to revitalize our communities, create jobs and strengthen our economy."