Picketing on major construction sites in the Seattle, Washington area has been going on since November 2021, with workers striking against concrete suppliers for competitive wage increases and better health care — and the strike shows no sign of ending, as workers are still unsatisfied with the treatment they’ve seen thus far.
The situation in Seattle calls attention to the growing momentum of fair-wage movements that have accelerated in recent years. Due to a variety of reasons — including recent rising levels of inflation — workers have become more willing to change jobs in search of better wages.
President Biden’s decision to raise the minimum wage for federal contract workers to $15 added further pressure for local administrations and private companies to follow suit and increase wages. Some companies have gone even further: For example, in order to entice workers, Target is now offering $24 per hour in some markets.
How construction businesses stay competitive
The construction industry is not immune to these pressures. For nearly two years, contractors have been stretched thin by rising materials prices and widespread labor shortages.
Like in Seattle, construction labor unions across the country are pushing for better wages and improved benefits, and are clashing with contractors who may be afraid of what increased labor costs will do to an already treacherous balance sheet.
So what do contractors need to know about the rising costs of labor in order to stay competitive in this challenging climate?
Keeping quality employees means quality projects
“One dilemma contractors run into when trying to cut labor costs is that they end up hiring unqualified, untrained people off the streets,” said Dave Brier, Business Manager for Laborers Local 517 in Orlando, Florida in an interview with Levelset.
Less experience leads to lesser quality work, according to Brier, and the only answer is to “pay more for the cost of labor — you have to pay more for high quality.”
“What we’re seeing now with the strike in Seattle is that when the professional trained workforce is out on strike, companies are bringing in untrained workers to operate old equipment,” said Jamie Fleming of Teamsters Local 174 — the Seattle-area labor union — when speaking with Levelset.
“This can be disastrous. Concrete gets spilled, there’s little PPE, people get hurt, there are lawsuits… the difference in quality between a trained workforce and an untrained workforce is clearly visible,” continued Fleming.
To put it simply, you can’t finish projects without good employees. High-quality workers are an essential part of the construction process and should be factored into project bids accordingly.
“Over the course of the pandemic, we have seen very clearly that there is such a thing as an essential worker that we can’t do anything without,” said Fleming. “Workers in the construction industry are essential and deserve to make a living wage.”
“Higher wages also bring loyalty,” continued Brier. “People are incentivized to go for higher-paying jobs. If workers aren’t constantly on the lookout for an extra 50 cents or another dollar, you’ll get a lot more longevity out of the workforce.”
Wage increases are likely inevitable, especially long-term — but the good news is that ultimately it will be the property owner that will absorb the increased costs of labor.
Build increased wages and cost into project bids
According to Brier, it’s important for contractors to build increased costs and wages into project bids. “When going into a competitive bid, contractors should try to make a larger bid in order to account for higher labor costs,” said Brier.
Increasing wages may actually be the cheapest and most painless option for contractors long term. Worker strikes can be incredibly costly — the strike in Seattle is nearing 100 days and has led to massive backlogs of unpoured concrete, smothering the region’s construction industry and causing significant project delays.
Negotiations between union officials and business owners have not made much progress, but it’s clear the holdout is costing business owners an incredible amount of money. Contractors have been forced to lay off thousands of workers as projects were delayed and revenues dried up.
“As far as we can tell, this is philosophical at this point. It stopped being about the money it seems a long time ago because the employers have lost way more than [the disputed wage increases] would have ever cost them,” according to Fleming.
The way that strikes like these affect contracts can be complex, as well. Construction delay claims are one of the most common aspects of construction contracts, but it gets a lot more difficult to sort through when it comes to the question of possible compensation and who could be responsible for any damages in the end.
Contracts for the affected projects will have to be examined to see if project completion will be affected, how much could be considered in the contractor’s control, and if parties need additional compensation.
That could have a major impact on union negotiations, as contractors may want to ensure that the impact of strikes is kept to a minimum on future projects.
Workers in Seattle continue to speak out
Seattle concrete workers have spoken out about how much more stressful their work is than a layman would expect — and are insistent that their rights and compensation need to reflect that.
The impact of the strike is even making some question whether they need to return to the industry — an especially worrying prospect for contractors amidst the much-publicized “great resignation.”
“All we want is, you know, something fair in return. It’s not too much to ask,” said concrete worker Ron Hills. “It’s kind of heartbreaking. I don’t want to retire on their terms. I’d like to retire on my own terms. But if this keeps going I might just say the heck with it. Call it a career.”
“Companies are always willing to invest in their equipment, in automation, in new facilities,” said Fleming. “But they also need to be willing to invest in their workforce. Just like with their equipment, it will pay off.”
“We’re all out here just fighting for what’s been established in our industry as a base and we want to be met right there. Nothing below that,” said Tim Davis, a Seattle concrete mixer truck driver. “It’s tough for everyone. I know that other people have been laid off, and I feel for them. We want this over as soon as possible. We’re willing to negotiate, we just need the other end to do the same.”