The high price of union construction: Fix work rules or jobs will vanish

In New York, the once-dominant construction unions have seen their share of the market shrink.

For a century and a half, unions have been a critical channel of upward mobility for millions of Americans. They've fought for and protected decent wages, benefits and working conditions, with a particularly courageous history in often deadly professions such as mining and railroading. Yet in recent decades, union membership and power nationwide have eroded, with the loss of industrial jobs to lower-cost competition, as well as to innovations in technology and productivity. Growth in union membership has been limited to the service - and especially the public-service - sectors.

In New York, the once-dominant construction unions have seen their share of the market shrink. Nonunion construction jobs, which constituted roughly 10% of the industry in the 1970s, are now generally thought to be 40% - and growing.

The causes of this shift are complex, but the driving force is cost. Open shops - projects that hire both nonunion and union members - are 20% to 30% less expensive than union shops. Some of that differential comes just from lower nonunion wages and benefits; most comes from unproductive union-mandated work rules and practices.

Indeed, much of the gap could be bridged by making one overarching change: requiring a fully productive eight-hour workday from all union workers in exchange for an eight-hour paycheck.

Surprised that this isn't already the case? Well, it's not. Contractors estimate that they obtain only four to five hours of productive work for every shift paid (currently seven hours for most trades).

Why? Various practices combine. They include numerous work-task handoffs among trades, specific mandates for crew makeup and construction methods used, and requirements to start and end the paid workday at the union local's ground-level shanty rather than wherever on the site the work is to be done. Transport to and from the actual work location takes time - and lunch often adds a second roundtrip.

At the same time, the temporary and volatile nature of the business encourages many workers to try to extend every job as long as possible.

Quarrels between unions over jurisdictional claims - meaning, which trades are contractually entitled to perform which tasks - only make matters worse. In 2009, for example, an arbitration panel settled a disagreement between carpenters and electricians about which union should install reflector black-outs in the Goldman Sachs headquarters in Battery Park City. The decision awarded installation of the black-out to the carpenters - and drilling of holes for the fixture stems to the electricians. In addition to mandating the payment of two people to perform the work of one, this type of Solomonic division compounds the complexity of union building.

The construction industry in New York is a case study in the challenges and decisions facing organized labor today. Trained and skilled union workers are best equipped to build on the necessary large scale - but a range of practices make their expense too high for some developers to bear.

Construction needs to thrive in this city - and not only because the industry is one of our last blue-collar union professions. We need to build and renovate more affordable housing. We need cutting-edge commercial buildings to attract innovative businesses.

If developers can't build efficiently and affordably, we're sunk.

This is the key moment for the construction unions to modernize their practices in order to save themselves. With unemployment of 30% or more - and expiration this year of 29 crucial labor contracts - they have a choice: help make building in New York City more efficient and affordable or watch nonunion labor make ever greater gains.

Hope Cohen is associate director of Regional Plan Association's Center for Urban Innovation and co-author, with Julia Vitullo-Martin, of a new report on construction labor costs.