Positive News on the Construction Employment Front

According to a new press release from the Associated Builders and Contractors, the construction industry is on a positive trajectory as the industry gained jobs in September.

The construction industry rebounded in a meaningful way in September by gaining 23,000 net new jobs on a monthly basis after losing 5,000 net jobs in August, according to an analysis of U.S. Bureau of Labor Statistics data released today by ABC. Despite the broader industry gains, the nonresidential sector added just 2,700 net new jobs for the month, while the residential sector added 15,700 new


“Recent reports indicate that wage growth in America has accelerated significantly over the past year,” said ABC Chief Economist Anirban Basu. “Not only has this helped to support consumer spending, it appears to be inducing more people into America’s labor force. Despite recent job growth in construction and the balance of the economy last month, both industry and national unemployment rose. For operators of construction firms, this should be considered good news as survey data indicate that the lack of appropriately skilled labor represents the biggest concern for U.S. construction firms by far.

“Though construction added jobs in September, not every segment experienced increased hiring activity,” said Basu. “Driven by strong multifamily segments and an improving single family housing market, job growth in residential construction was robust. However, nonresidential employment growth was far less impressive, and nonresidential building construction actually declined. This may be part of an emerging pattern. The most recent Architecture Billings Index also revealed some nascent weakness in commercial construction activity. There may be many reasons for this, including seasonal fluctuations. However, there are also data indicating that credit available to commercial real estate is beginning to tighten up. It also remains difficult for many mixed use developers to line up enough office tenants to allow projects to move forward.

“All told, today’s data should be viewed favorably,” concluded Basu. “America’s consumer-led recovery continues to produce enough jobs to sustain itself, and chances of near-term recession remain quite low.”

The construction industry unemployment rate inched a tenth of a percentage point higher in September and now stands at 5.2 percent. The unemployment rate for all industries rose by the same amount, reaching an even 5 percent. This is likely attributable to the 444,000 new persons in the labor force. The labor force has expanded by roughly 2.1 million workers through the first three quarters of 2016. The last time the labor force grew that much through the first nine months of the year was 2000, the penultimate year of the dot-com bubble.

Read more about the construction employment report.

Clemson University to Host Construction Symposium

Clemson University has announced the first annual Construction Industry Symposium sponsored by the University’s Department of Construction Science and Management. Participants will gain valuable knowledge and perspective from leading experts about critical issues affecting the industry now and insight into anticipated changes.

“The Ever-changing World of Construction: Today’s Challenges, Tomorrow’s Opportunities,” offered by Clemson’s construction science and management department, is scheduled for Oct. 18 at Le Meridien Hotel in Charlotte, N.C.

The inaugural event is expected to draw attendees from across the region — facility owners, construction companies, specialty contractors, designers, vendors and other construction industry service providers.

“This centrally-located, regional event fills a void left by typical construction industry summits,” said Dr. Roger Liska, professor and chair of Clemson’s construction science and management department. "Our information-packed agenda offers a significant amount of construction industry-related ‘intelligence,’ presented and discussed by industry leaders in one place on one day."

“Attendees will leave with an arsenal of information to help them prepare their businesses for the challenging road ahead in the construction industry," Liska added. "Our long-range plan is for the symposium to become an annual event that people will look forward to every year. We also expect this to be a beneficial learning experience for students in our construction science and management program.”

Morning and afternoon keynote addresses will be followed by panel discussions, led by industry experts, on issues impacting the construction industry today with special focus on the future.

Anirban Basu, chief economist with Associated Builders and Contractors of Washington, D.C., will kick off the morning session with “The Economist Who Loved Me.”

James Benham, president of JBKnowledge Inc. of Bryan, Texas, will launch the afternoon session with “How Drones, Sensors and Integrated Apps are Rewriting All of the Rules in the Construction Industry.”

Bill Caldwell, president and CEO of Waldrop Mechanical Services and leader of the Corporate Partners task force, will moderate. Watch an interview with Bill Caldwell.

This new symposium was developed by Clemson’s construction science and management corporate partners and industry advisory board, with support from several leading construction industry associations.

Early registration discounts are available through Sept. 2. To register, visit the Clemson Marketplace.

Construction Growth Forecasted for 2016

According to a recent forecast by FMI, a consulting group specializing in the engineering and construction industry, construction activity will continue to grow in 2016. FMI reported that construction put in place will slow to a 6% growth rate in 2016.

In 2015, construction added 11% growth to reach nearly $1.1 billion in construction put in place since 2008.  Signs that the rate of growth for the industry is slowing reduced the forecast for 2016; however, construction put in place will reach $1.6 billion.

The increase in construction activity has also spurred growth in construction employment. The U.S. construction industry added 37,000 net new jobs in March 2016 according to an analysis of  the recent  U.S. Bureau of Labor Statistics release by Associated Builders and Contractors (ABC). On a year-over-year basis, construction employment expanded by 301,000 net new jobs, the industry’s largest annual increase since May 2015.  

“Naturally, consumer spending-led recoveries such as this more directly impact residential construction segments than nonresidential," said ABC’s Chief Economist Anirban Basu. "Accordingly, the residential construction recovery continues to be a bit more forceful and that is likely to continue during the months ahead.”

Improving consumer economic and physical health and a growing population demanding new technologies and housing are contributing to the forecast of projected growth.. Those consumers, especially younger consumers are also highly mobile and gravitating most often toward larger cities for jobs and entertainment. With all the good news for construction markets, FMI notes that it must also echo the sentiments of the Federal Reserve and say: "Global economic and financial developments continue to pose risks,"

FMI recommends cautious optimism for 2016 and offers these forecasts for some key sectors:

• Manufacturing – Manufacturing construction took a heavy hit during the Great Recession, but it has more than caught up as of 2015, with a whopping growth of 44% for the year and a more modest 9% growth expected for 2016. In either case, new records are being set for manufacturing construction investment. While, at 76.1 for February 2016, manufacturing capacity utilization is still below the long-term average of 78.5, there are signs that new capacity is being well utilized. 
• Residential Construction  – FMI forecast residential construction will grow at a rate of 6% for 2016, with the largest rate of growth in multifamily housing (12%). Compared to 2015, growth will be cut by more than half. There are signs that some of the slower growth is due to homebuilders—like most all contractors—having difficulties fnding qualifed labor, thus needing to increase wages to attract more workers.
• Lodging – Lodging construction continued to rise above even increasingly optimistic forecasts for 2015 to end the year with 31% growth. At this point, FMI again expects the rate of growth to cool, but, at 15% for 2016, it will still be the fastest-growing construction market. With an expected value of $24.3 billion for 2016, this market is well below its high of $35.8 billion in 2008, but we expect these numbers to be more sustainable with a mix of new venues and refurbishing established locations.
  Office – After a strong show of growth in 2015 (22%), we expect office construction to cool in 2016 to a still respectable rate of 9% growth. Much of the growth has come from an increase in employment, especially in high-tech job markets. These high growth rates will taper off to more sustainable rates in 2017 and beyond. Continued growth in the technical sector and in larger metropolitan areas like New York City will keep rents and absorption of new space high.
  Power – After a strong year in 2014, power construction declined sharply in 2015, losing 14%. FMI expects another 4% drop in 2016, thus giving up the gains realized since 2012. The power industry is in flux due to changing fuel supplies using more natural gas and less coal as well as variable rates of growth in alternative energy sources like solar and wind. Power plants must be updated to keep up with changing requirements as well as to manage distributed generation sources. Despite losing subsidies and the lower cost of oil and gas, wind and solar power generation facilities are growing. The power industry will continue to consolidate as the average consumer reduces power use, but growth will slow in 2016 and 2017.

Download the Q1 Construction Outlook

Construction Sector Remains One of Economy’s Bright Spots

With mixed economic reports, engineering and construction firms are looking for encouraging signs to make future plans. According to the U.S. Bureau of Labor Statistics report, the U.S. construction industry added 37,000 net new jobs in March. 

The Associated Builders and Contractors (ABC), in a release, reported that on a year-over-year basis, construction employment expanded by 301,000 net new jobs, the industry’s largest annual increase since May 2015.  The industry added 20,000 net new jobs in February (revised upward from 19,000) and 18,000 net new jobs in January.

In March,  he nonresidential sector added 12,700 jobs on a monthly basis in March after adding only 1,300 net new positions in February (revised downward from 2,800). Nonresidential specialty trade contractors added 6,500 positions in March after losing jobs in the first two months of the year. Heavy and civil engineering employment added 11,200 net new jobs in March, the sector’s largest gain since January 2014, perhaps partially because recently passed federal highway legislation signals more work in the pipeline.

“The headline job growth number tells us that construction remains one of the U.S. economy’s leading economic drivers,” said ABC’s Chief Economist Anirban Basu. “While the broader economic recovery remains in place, construction accounts for a disproportionate share of that recovery. Many other aspects of the recovery remain at least somewhat unsatisfying, including surprisingly soft wage growth, weak corporate profits and sluggishness in business investment. However, demand for labor remains high, including in a number of key nonresidential construction segments.

The construction industry unemployment rate remained unchanged at 8.7 percent in March, but remains almost a full percentage point lower than at the same time one year ago. The unemployment rate across all industries rose by a tenth of a percentage point in March and now stands at 5 percent. This slight uptick is largely attributable to the 396,000 people who entered the labor force in March, a positive indication for the durability of the expansion.

“Continued job growth helps fuel both spending power and confidence,” said Basu. “Naturally, consumer spending-led recoveries such as this more directly impact residential construction segments than nonresidential. Accordingly, the residential construction recovery continues to be a bit more forceful and that is likely to continue during the months ahead.”

Read Release

Economic Growth Stronger than GDP Figures Suggests

Positive news for the economy as both real gross domestic product (GDP) and nonresidential fixed investment expanded during the third quarter, according to an analysis by Associated Builders and Contractors (ABC) of today’s  release from the Bureau of Economic Analysis. GDP expanded 1.5 percent (seasonally adjusted annual rate) during the third quarter while nonresidential fixed investment expanded by 2.1 percent during that period, both building on positive results from the previous quarter.

The bureau estimated that GDP expanded 3.9 percent during the year’s second quarter, while nonresidential fixed investment was revised upward to a 4.1 percent increase from an initial estimate of a 0.6 percent decrease. This marks the second consecutive release in which the previous quarter’s nonresidential fixed investment figure was amended from negative to positive. Investment in nonresidential structures fell by 4 percent after growing by 6.2 percent in the second quarter.

“The U.S. economy is not quite as bad as the headline GDP number suggests,” said ABC Chief Economist Anirban Basu. “Private final demand, an indicator that represents sales to nongovernmental domestic purchasers, expanded by 3.2 percent in the third quarter. Many economists consider this the most telling and persistent aspect of GDP, suggesting that the economy is healthier than some might suspect.

“The current quarter was heavily impacted by a foreseeable inventory adjustment, a stronger dollar and a weakening global economy,” said Basu. “The fact that the recovery remains in place is reflected in fixed investment data, including the categories that relate most directly to nonresidential construction. While it is true that investment in structures slipped 4 percent, this largely appears to be a statistical give-back from the second quarter’s better than 6 percent performance. Other data indicates ongoing momentum in nonresidential construction, which should be more apparent during ensuing GDP releases.

“The recovery will continue to be led by consumers,” said Basu. “Interest rates will also feature prominently in terms of determining the extent to which the recovery will be sustained in 2016 and beyond. For now, ultra-low interest rates are inducing people to invest in order to generate financial yields. This has been a bonus for nonresidential construction, but potentially may be triggering over investment in certain construction segments.”

The following segments highlight the third quarter’s GDP release.

• Personal consumption expenditures added 2.19 percent to GDP after contributing 2.42 percent in the second quarter.
• Spending on goods grew 4.5 percent from the second quarter.
• Real final sales of domestically produced output increased 2.9 percent for the third quarter after a 3.7 percent increase in the second quarter.
• Federal government spending increased 0.2 percent in the third quarter after remaining unchanged in the second quarter
• Nondefense spending increased 2.8 percent after decreasing by 0.5 percent in the previous quarter.
• National defense spending fell 1.4 percent after inching 0.3 percent higher in the second quarter.
• State and local government spending expanded 2.6 percent during the third quarter after an increase of 4.3 percent in the second.

ABC Upstate Names 2015 Council Leadership Team

The Associated Builders and Contractors (ABC) of the Carolinas announces the 2015 leadership team for the organization’s Upstate (SC) Council.

Gavin Axson, Senior Project Manager for Brasfield and Gorrie, has been named Council Chairman. He will be working closely with the 2015 leadership team which includes:
• Chris Moore, Carolina Power — Past Chair
• Kyle Dillard, Ogletree Deakins — Government Affairs
• Chauncey Tschiffely, Trinity Consulting — Workforce Development
• Rob Wess, Yeargin Potter Shackelford — Membership
• Joan Krause, KBR Building Group — Public Relations
• Brian Gallagher, O’Neal — Board Liaison
• Bill Caldwell, Waldrop Mechanical Services — Board Liaison
• Brett Caldwell, Caldwell Constructors
• Bryan Finch, Hajoca
• Dan Polstra, Trane
• Matt Stalnaker, Dixon Hughes Goodman
• Ed West, O’Neal

“ABC is the only industry association that represents the entire construction team (general contractors, specialty contractors, suppliers, industry professionals) with an equal voice,” said Gavin Axson, 2015 ABC Upstate Chairman. “This year we will continue to address the issues of an aging workforce with our workforce development programs and outreach in an effort to attract young people to the construction industry. Another critical item of focus will be membership recruitment and retention.”

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ABC Predicts Continued Construction Industry Growth in 2015

It's that time of the year when the economic forecasters release their predictions for the next year. One of my favorite economists is The Associated Builders and Contractors (ABC) Chief Economist Anirban Basu. In Basu's ABC forecast, he sees a steady and ongoing economic recovery for the U.S. commercial and industrial construction industries in 2015. Basu believes the industry recovery in 2014 should continue in 2015, with momentum especially growing in segments closely related to the current American energy and industrial production resurgence.

“ABC forecasts nonresidential construction spending will expand by roughly 7.5 percent next year,” said ABC Chief Economist Anirban Basu. “The segments that will experience the largest growth in construction spending in 2015 include power (e.g. natural gas-related construction), lodging (leisure and business spending), office space (professional services employment creation) and manufacturing (rebounding industrial production).

“The public sector will see far more sluggish growth in construction spending,” Basu warned. “However, this fits a multi-year pattern with private nonresidential spending exceeding public nonresidential spending by 28 percent in 2014, up from 15.6 percent in 2013.

Read Release

Leading With Marketing

Successful construction firms don’t view marketing as an expense, but rather a strategic approach to business. The “leading with marketing” philosophy embodies how a company approaches its business, marketplace and clients. When companies lead with marketing, they choose which markets to target, what services to offer, how to differentiate, how to communicate and how to win.

Marketing is the art and science of creating awareness, delivering value, selling services, satisfying needs and getting clients to buy again. While marketing is an integral part of the business world, too many construction firms do not understand how to use and apply marketing tools and strategies. Now is the time to take the lead and embrace a strategic and integrated marketing program.

Defining the Role of Marketing
The role of marketing within a construction firm should focus on understanding, creating, communicating and delivering value. A construction firm’s marketing strategy must set the direction and scope of the organization while supporting the company’s business plan and strategic objectives.

Ultimately, the role of marketing is a summation of activities designed to identify opportunities, win projects, satisfy client needs and win more work. Contractors earn revenue by successfully completing profitable projects. Marketing efforts must be built around strategies and actions that position the firm to get more profitable projects.

Establishing a Competitive Advantage
Every day, more firms enter the construction market, and existing firms grow and diversify into new markets. To survive and thrive, contractors must establish a competitive advantage.

A competitive advantage can be derived from a number of sources, but ultimately it is based on the value a firm brings to its clients. This value can come from a unique combination of resources, a cost advantage, a market position, niche focus, financial resources, relationships, reputation or experience.

Differentiating from the Competition
Differentiation is the process of distinguishing services from the competition. Not all construction firms are the same, but not every company capitalizes on its differences. Part of the marketing process is to identify those differences and turn them into meaningful value propositions.

The client value proposition consists of the sum of benefits and value derived in return for payment of the product or service. In other words, it’s what clients get for their money. For construction firms, the value proposition shouldn’t speak to the services offered; rather, it should focus on the benefits clients derive from those services.

Positioning
Deciding how to position a firm’s products and services needs to flow from its business plan and align with its differentiation strategy.

Positioning is the process by which a company creates an image or identity for a particular service or brand in the minds of its target audience. A position is considered relative in comparison to competitive offerings. Ultimately, positioning should help the client answer the question, “Why should I buy from you?”

Messaging Well-developed messaging is the backbone of branding. Given the rapid pace of technology today, the marketing message has taken on new forms and is engaging with audiences at an unheard-of rate.

With the Internet, mobile technology and digital media, clear marketing messages can have a far-reaching impact. The development of an effective marketing message is essential to building a brand and implementing a marketing strategy.

Integrating Marketing Communications Marketing communications are designed to deliver a clear, compelling message to the right decision-maker or influencer. However, more ways to communicate this message exist than ever before. Marketing efforts must continue to more effectively build brand awareness and preference, while also delivering a measurable return on investment. Savvy construction marketers increasingly embrace the concept of integrated marketing communications—a strategic approach designed to harness all aspects of marketing communication tools to work in coordination as a unified force.

Marketing as a Strategic Thought Leader
Marketing, whether an individual or a department, must strategically look at the key drivers to the company’s success and growth and help align resources to deliver profitability and build value.

To truly lead with marketing, a firm’s marketing strategy must be an ongoing, dynamic process that enables a company to focus its resources on the right opportunities to increase profitability while satisfying the clients’ needs and achieving a sustainable competitive advantage.


Construction firms lead with marketing to:

Thie article orginally appeared in the September 2012 issue of Construction Executive Magazine

By: Brian Gallagher and Kimberly Kayler

• frame the company’s vision and direction;
• gain commitment to strategy;
• research, target and segment markets, as well as understand client needs;
• make strategic choices and decisions;
• align resources to grow and invest in the business;
• define the company’s competitive advantage;
• differentiate offerings and define the company’s value proposition;
• define strategies to target and communicate with audiences;
• link marketing, business development and account plans;
• demonstrate a return on investment;
• uncover unmet client needs;
• establish a basis for how the company creates, delivers and manages client value;
• set objectives, strategies and metrics;
• measure performance; and
• make a profit.

Brian Gallagher, director of marketing for O’Neal, Inc., and Kimberly Kayler, founder and president of Constructive Communications, Inc., are co-authors of Leading with Marketing. For more information, email bgallagher@onealinc.com or kkayler@constructivecommuncation.com, or visit www.leadingwithmarketing.com. 



Read Article in Construction Executive Magazine

Clemson Construction Team Places Third Nationally

Published May 14, 2012, GSA Business

A Clemson University team of construction science and management students recently placed third nationally in a construction management competition.

Clemson University’s Construction Science and Management Team takes third place in a national competition, sponsored by the Associated Builders and Contractors. Pictured left to right: Thomas Carlson, John McLoud, Shima Clarke, Stacey Nicol, Brandon Humphries and Daniel Simpson. (Photo/Provided)

Students from 25 colleges and universities from across the country competed in: project management/scheduling, estimating and safety.

The Clemson team won third place in the project management and scheduling category in ABC’s 12th Annual National Student Chapter Construction Management Competition in San Antonio last month. The Upstate S.C. Council of theAssociated Builders and Contractors of the Carolinas sponsored the students.

The competition gives students a glimpse into the real world of construction and an opportunity to showcase their talents.

“The ABC Upstate Council is proud of the efforts of our student chapter at Clemson,” said Brian Gallagher, Greenville-based O’Neal Inc. marketing director and the ABC’s Upstate Council chairman. “The team members, and their coaches, put a tremendous amount of effort into their project and presentation and we are pleased that they were recognized nationally.”

Students worked in teams of four in an intense day-long competition, taking part in a bid-day drill. Prior to the competition, teams prepared a bid package which included a detailed project estimate, project management plan, project schedule, an economic inclusion plan and a site specific safety plan.

They came prepared to adjust their work based on changes to the project, such as site logistics. Eight finalist teams were chosen to verbally present their submissions to a panel of judges acting as owners’ reps and design professionals.

The Clemson student team included Stacey Nicol, a senior, who served as team captain and project manager; Daniel Simpson, a junior, who served as superintendent; John McLoud, a senior, who served as lead estimator; Thomas Carlson, a senior, who served as safety engineer; and Brandon Humphries, a junior, who served as division manager.

Clemson University’s Construction Science & Management Department faculty members, Carolina Safety Consultants, Trehel Corp., O’Neal Inc., Waldrop Mechanical Services and Cely Construction all supported the team in some way.

“The students worked very well as a team, with each team member having a good understanding of the entire project and each other’s strengths and weaknesses,” said Shima Clarke, a Clemson associate professor of construction science and management. “This led to effective communication and trust, which, along with a lot of hard work and dedication, led to their success at the competition.”

The Associated Builders and Contractors of the Carolinas represents the merit construction contractors and related firms in North and South Carolina. ABC of the Carolinas is a chapter of the national ABC organization which represents more than 25,000 members.

Impact of Union Activity in South Carolina

Despite a miniscule union footprint in South Carolina, the construction industry is lobbying state lawmakers to take stronger steps to suppress union activism.

“We’ve seen what is happening with Boeing and the NLRB (National Labor Relations Board). I think we all realize South Carolina is on the radar of the unions,” said Leslie Hope, S.C. government relations director of the Carolinas Associated General Contractors.

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At issue now are so-called project labor agreements strongly supported by an executive order President Obama issued in 2009. PLAs are similar to collective bargaining agreements that establish upfront the rules and wages for all employees on a project.

Critics argue the agreements can drive up construction costs and scare away nonunion contractors from bidding on projects. Proponents say PLAs ensure reliable labor and deliver projects on time and on budget.

Obama’s executive order did not mandate PLAs, but it suggested they be used on all federally funded construction projects exceeding $25 million.

The Army Corps of Engineers is taking testimony from construction companies about potentially using PLAs on the barracks project at Fort Jackson, said Bill Caldwell, president of Waldrop Mechanical Services in Spartanburg.

Another S.C. project that could be subject to a PLA is the eventual construction of a new federal courthouse in Greenville, said Brian Gallagher, Upstate chairman for the Associated Builders and Contractors Carolinas Chapter and director of marketing for O’Neal Inc. in Greenville.

“What we see and we fear is today its $25 million, by executive order by President Obama, but it only takes a strike of a pen to lower that amount to $20 million, $10 million,” Gallagher said. “It’s going to shut out most of the construction companies in South Carolina from even bidding on the work.”

Other states have fought PLAs without success. Michigan enacted a ban on PLAs that was ruled unconstitutional by a federal judge in February. An appeal is expected.

South Carolina lawmakers are pursuing a similar measure that would prohibit project labor agreements on any publicly funded projects. It’s a provision of the “Right to Work Act of 2012," or House Bill 4652, that has already garnered Gov. Nikki Haley’s support. The House passed the legislation 70-19.

“I thought it was much to do about nothing,” said Rep. Chandra Dillard, a Greenville democrat who voted against the bill. “South Carolina already has a really low union environment. I see this as a very divisive conversation that often occurs in Columbia around election time to divert our attention from the real issues in South Carolina – funding education and transportation infrastructure.

“At the very end of the day, is it so bad that people are making a living wage if they’re working for a union?” Dillard added.

Caldwell called PLAs a threat to his livelihood and career, saying they prevent his company from competing for projects.

The union membership rate in South Carolina is 4.6%, one of the lowest in the nation, according to data from the U.S. Bureau of Labor Statistics. But unions are attempting to organize here, Caldwell said. Waldrop employees have found union fliers on their vehicle windshields when leaving job sites, he said. That organization quickly died though.

Still, Caldwell, Gallagher and Hope all agreed that South Carolina is likely to be a union target following NLRB’s unsuccessful challenge to Boeing’s decision to build a plant in North Charleston. The NLRB’s complaint argued that Boeing’s decision was retaliation against the Machinists union for past strikes. NLRB dropped the case shortly after Boeing and the Seattle-area union ratified a new contract.

“The threat of union organization coming south and infiltrating South Carolina is growing because of that,” Caldwell said.

This article was writer by Scott Miller and originally appeared in the GSA Business on March 12, 2012.

http://www.gsabusiness.com/news/43077-construction-industry-fears-union-action

Project Labor Agreements Will Hurt South Carolina

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What if a company announced it was hiring dozens of people in your community, but said 98 percent of the qualified applicants shouldn’t bother applying because they weren’t even going to be considered?

What if somebody said that the only way for you to get a job in your community was to join an exclusive club dominated by out-of-state interests who don’t share your values?

What if you were a business owner and were told that even though you earned a job through a competitive bid, you still had to pay a kickback to an outside group — driving up your costs and decimating your profits?

Those “what-ifs” are exactly what you get when the government forces project labor agreements (PLAs) onto taxpayer-funded construction. That’s why Associated Builders and Contractors supports state Rep. Bill Sandifer’s, R-Seneca, efforts to ensure fair and open competition on government construction projects through the Right to Work Act of 2012.

Rep. Sandifer, chairman of the House Labor Commerce and Industry Committee, introduced the bill to prohibit state and local governments in South Carolina from imposing PLAs. Gov. Nikki Haley also has expressed support for the bill.

PLAs are pre-hire deals that set certain rules for contractors and subcontractors that work on a construction job. A typical PLA will require contractors and subcontractors to go through labor unions to hire workers for a project, pay union wages, follow inefficient union work rules, and pay into union benefit plans during the life of the project.

PLAs were born in an era when almost every construction worker belonged to a union. Nowadays, only 14 percent of America's private construction workforce belongs to a union. That number is only 3 percent in South Carolina. In the modern construction marketplace, PLAs tilt the playing field in favor of a small group and threaten to shut out everyone else.

The Obama administration has strongly encouraged federal agencies to consider using PLAs on large federal construction projects, making government-mandated PLAs more common in recent years. In South Carolina, the U.S. Army Corps of Engineers is considering a PLA mandate for a barracks construction project at Fort Jackson.

If these special interest handouts are allowed to proliferate in South Carolina, local contractors will effectively be shut out of bidding on work. Instead, the jobs will go to out-of-state firms. Out-of-state workers with union connections will flock to the area, resulting in fewer opportunities for our citizens.

Adding insult to injury, workers who live and pay taxes in South Carolina will see the price of public construction rise, as PLA mandates add an unnecessary layer of union-fueled costs to each project. In the end, the working-class taxpayer loses a job opportunity while also being soaked for additional tax dollars.

The good news is 11 states have taken action to ban government-mandated PLAs, with even more poised to do so in 2012. South Carolina has the opportunity to join the group of states that believe contractors should be able to competitively bid projects based on merit and not on union affiliation.

Economic development often hinges on a company building a new facility or expanding an existing one. PLAs have a negative impact on the business environment in a state, and could make it harder for South Carolina to remain competitive and attractive compared to states that more fully embrace the right-to-work concept. As the economy improves, South Carolina must be positioned to earn its share of new job creation opportunities.

At Associated Builders and Contractors, our core belief is that public construction projects should be awarded on the merit of a contractor’s work. Our nation’s greatness is built on fair and free markets. PLAs threaten fairness. The Right to Work Act of 2012 will ensure that business owners are treated fairly and local citizens get the most value for their tax dollars on construction projects.

If these special interest handouts are allowed to proliferate in South Carolina, local contractors will effectively be shut out of bidding on work. Instead, the jobs will go to out-of-state firms. Out-of-state workers with union connections will flock to the area, resulting in fewer opportunities for our citizens.

Adding insult to injury, workers who live and pay taxes in South Carolina will see the price of public construction rise, as PLA mandates add an unnecessary layer of union-fueled costs to each project. In the end, the working-class taxpayer loses a job opportunity while also being soaked for additional tax dollars.

The good news is 11 states have taken action to ban government-mandated PLAs, with even more poised to do so in 2012. South Carolina has the opportunity to join the group of states that believe contractors should be able to competitively bid projects based on merit and not on union affiliation.

Economic development often hinges on a company building a new facility or expanding an existing one. PLAs have a negative impact on the business environment in a state, and could make it harder for South Carolina to remain competitive and attractive compared to states that more fully embrace the right-to-work concept. As the economy improves, South Carolina must be positioned to earn its share of new job creation opportunities.

At Associated Builders and Contractors, our core belief is that public construction projects should be awarded on the merit of a contractor’s work. Our nation’s greatness is built on fair and free markets. PLAs threaten fairness. The Right to Work Act of 2012 will ensure that business owners are treated fairly and local citizens get the most value for their tax dollars on construction projects.

Brian Gallagher is chairman of the Upstate SC Council of the Associated Builders and Contractors of the Carolinas. ABC is dedicated to the protection and enhancement of the free enterprise system within the construction industry. This article orginally appeared in the Greenville News on February 25, 2012.

ABC Carolinas Names O'Neal GC of the Year

Associated Builders and Contractors of the Carolinas has named O’Neal, Inc., its General Contractor of the Year. 

O’Neal, an integrated design and construction firm with offices in Atlanta, Greenville, and Raleigh, was recognized for its outstanding business practices and service to the industry. O’Neal will be officially honored during the ABC Carolinas Construction Conference Aug. 4-6 in Charleston. 

“Being recognized by peers in our profession makes us extremely proud and honored. We are proud to be the only general contractor in North or South Carolina to achieve this distinction,” said Kevin Bean, O’Neal president and CEO. “We have assembled a strong, growing team of project delivery professionals that create cost-effective capital solutions for our customers. This honor is a reflection of the hard work of our employee-owners, and we are grateful that ABC recognized us.” 

“O’Neal and their employees represent what ABC stands for: Free Enterprise and The Merit Shop Philosophy,” said Doug Carlson, president and CEO of ABC Carolinas Chapter. “O’Neal supports ABC’s mission with passion and integrity and is a leader in our industry, not a follower.” 

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ABC Offers Green Contractor Certification Program

For contractors interested in sustainability and green construction, the Associated Builders and Contractors (ABC) offers a Green Contractor Certification program. According to ABC, the programs documents the efforts of merit shop construction firms that are developing a sustainable workplace environment and to recognize those ABC members that are leaders in the green industry.

The process starts by submitting an application detailing green efforts and undergoing a third-party onsite assessment to achieve certification from ABC’s National Green Building Committee. ABC’s Certified Green Contractor program focuses on the green initiatives ABC member firms undertake in the workplace, not on construction practices, and it certifies companies, not individuals.

“ABC members have been on the forefront of the green building movement since its inception, but ABC also believes in stretching green achievements beyond the construction process and into the workplace,” said W. Brewster Earle, chairman of the ABC National Green Building Committee and president of Comfort Systems USA Energy Services, in Hartford, Conn. “The Green Contractor Certification program is another step in ABC’s goal to provide support and recognition for those firms that are setting an example for the industry by promoting green practices within the company and those that would like to create sustainability in the workplace as well as in construction practices.”

Twelve prerequisites ranging from the electronic distribution of documents to establishing an aggressive recycling program must be completed by each company. In addition, companies are required to fulfill at least 12 out of 36 elective items that include conducting a professional energy audit, engaging in water conservation efforts and providing incentives for carpooling or using public transportation. Each company also must achieve four education and training benchmarks, such as instructing employees on sustainability issues and requiring at least 25 percent of eligible managers to receive green building awareness education. For more information, visit ABC’s green website http://www.greenconstructionatwork.com/.