Unions across the country are hemorrhaging members, and the trend has started to hit the construction industry in New York City, one of the last bastions of organized labor.
A decade ago, easily 85 percent of all construction jobs in Manhattan were unionized, but the current total now represents “no more than 50 percent,” said Marolyn Davenport, senior vice president of the Real Estate Board of New York. The figure is far lower in Queens and Brooklyn, where a breakneck pace of residential development over the last five years created a labor crunch.
To stanch the bleeding and recruit new members, labor organizers face a number of problems, including globalization, lax governmental oversight, and difficulty in recruiting immigrant workers, say those familiar with the changing conditions.
Developers are also finding that rising land and construction costs means they have less money to devote to labor.
As unions find it increasingly difficult to mobilize public opinion through pickets and demonstrations, some are attempting to renegotiate work rules to compete with nonunion labor and conduct educational campaigns as they try to expand their reach in the outer boroughs, so far with limited success.
Several developers declined to speak on the record about the issue, skittish about a backlash from workers and colleagues. It’s New York’s 800-pound gorilla — developers loathe union wage costs and work rules, but union construction affords a comfort level for quality. At a new development forum held last month by The Real Deal, developer Jeff Levine said that nationwide just 20 percent of jobs were completed by union labor. In Manhattan, the number of union projects has been dropping and now represents about half of all job sites.
“We have to be competitive,” said Levine, principal of Douglaston Development and president of Levine Builders. One way to contain rising costs due largely to skyrocketing land and construction costs is to cut spending on labor, he said.
“The issue now for our members is that land costs are so high and union labor costs 20 to 25 percent more than non-union labor,” agreed Davenport at REBNY. “If a developer has to pay more for the land, it’s hard to make a profit and hire union labor. There’s no way to compete if construction costs eat up your profit.”
A rise in materials prices due to the damage caused by hurricanes Katrina and Rita, along with a spike in fuel prices, have also boosted construction costs and led developers to shy away from union workers, she said.
Antiquated and confusing work rules have also hurt the union cause, said Davenport.
“We have instances where unions take different holidays, force the hiring of two employees where one could do the job, and insist on an eight-hour workday,” she said. “When there’s a crane involved in a job site, yes, unionized labor is necessary, but the nonunion workforce is getting more skilled and more able to handle complex jobs.”
Several unions are trying to compete with nonunion labor and have also embarked on educational campaigns to convince developers that they get what they pay for when they hire nonunion workers.
“We are beginning to amend labor agreements and work conditions so we can compete with nonunion labor by trying to minimize cost differentials and convince developers that they’re going to get better quality construction built faster by union contractors,” said Louis Colletti, president of the Building Trades Employers Association, which represents 1,500 construction managers, general contractors, and subcontractors, all of whom use union labor.
Outside of Manhattan, “projects are becoming much more complex and they require a highly trained workforce to protect the public and the workers,” he said. “You’re starting to see projects of the size and scope of Manhattan being built in the Bronx, Queens, and Brooklyn, so it’s very important that the jobs are done right.”
Other union members dispute the idea that developers cannot afford to hire unionized labor.
“They buy one-, two-family houses, knock them down and put up six- or eight-family homes for, say, $500,000 apiece,” said Sal Zarzana, business manager at Local 926, a carpenter’s union in Brooklyn. “How can they say they can’t afford union help with any credibility when they make those kinds of profits?”
Unions also say the city coffers are shortchanged when nonunion labor is used. Colletti’s group estimates that nonunion construction keeps $1.2 billion in tax money from flowing through government coffers in New York City. Taxpayers take another indirect hit when they pony up for workers hurt on the job, since nonunion jobs are less safe and pay no insurance or workers’ compensation, he said.
He cited federal Occupational Safety and Health Administration figures calculating a rise of 78 percent in construction-related deaths in the last three years, most of which occurred on nonunion job sites — with non-English speakers representing a disproportionate share of the injured.
But whether or not construction unions’ arguments are justified, their attempts at organizing seem to be faltering.
While union representatives have tried to stop the flow of jobs to their unorganized counterparts, one factor hindering their efforts is that job actions no longer have the impact they once did.
“Pickets don’t work anymore,” said Colletti. “Years ago, we lost the connection with the average guy on the street. Here we are fighting to hold onto pensions and benefits, but people who pay for health care and lost their pensions walk past a building with an inflatable rat outside and don’t care that the work is done by nonunion labor.”
Unionizing immigrant labor is particularly difficult, said Andres Puerta, organizing project manager for the 75,000-member New York City District Council of Carpenters and Joiners of America.
“There’s a lot of mistrust of union activities by foreign-born, nonunion workers,” he said. “They don’t know the laws or the history of the labor movement so they’re prime targets for exploitation.”
While the construction boom would seem to help the union cause, there is so much building, especially in Queens and Brooklyn, that oversight becomes more difficult, said Colletti.
“Even though the number of building inspectors has increased 30 to 40 percent under the Bloomberg administration, it’s impossible to inspect every construction site,” he said. “Some contractors no longer file for permits and unless there’s a tragedy, no one knows they’re there.”