OP-ED: UNIONS HELP STABILIZE CONSTRUCTION COSTS
Tuesday, March 18, 2025
Crain's New York Business
Op-ed: Unions help stabilize construction costs
Bill Banfield
After a global pandemic and years of historic inflation, anti-union lobbyists in the construction industry are pushing a narrative that unions are to blame for increased construction costs. This tired ideological argument is at odds with the facts, and a blatant attempt to exploit global economic trends to score cheap political points. A deeper analysis clearly shows that organized labor is a moderating force in the construction industry.
The reality is that project labor agreements (PLAs) and other protections for construction workers benefit the state’s economy by ensuring large projects are completed on budget and on schedule. In New York City, PLAs have worked to ensure best practices are in place on critical projects – like LaGuardia and JFK airports, the Kosciusko Bridge, and public school improvements under the NYC School Construction Authority. Unions and PLAs prevent unexpected spikes in construction costs by setting wage and benefit rates that mitigate wild fluctuations in costs due to short-term market conditions, as we saw during the pandemic.
Unions are a convenient scapegoat for construction developers looking to assign blame for price increases, but a deep dive into the evidence tells a different story. The main reason construction costs have increased is because the cost of materials, such as lumber and steel, continues to increase. The specter of new tariffs on countries such as Canada, where American contractors source raw materials, also complicates near-term planning. Insurance costs are also rising, in part because of the higher rates of accidents at under-trained, non-union job sites.
Construction costs have come under increased scrutiny after Governor Kathy Hochul laid out an ambitious plan to invest in housing, infrastructure, and the energy sector. If anti-union activists in Albany have their way, those projects will move forward without basic labor protections.
The reason anti-union contractors oppose union-backed protections is because their business model relies on using lower cost, untrained workers – many from out-of-state. Non-union contractors frequently misclassify their employees as independent contractors, enabling them to underpay workers and avoid providing benefits. They underbid local contractors by cutting corners and then they take their profits and move on. This hurts workers, but it also hurts other contractors – including honest non-union contractors – who genuinely play by the rules. There are legitimate contractors out there who are also victims of the tax cheating, misclassifying, bottom-feeding contractors who take advantage of the system.
Labor protections contribute to economic growth by cycling investment back into the local economy. PLAs usually include local hiring provisions which ensure that local residents have job opportunities. When construction workers are paid a fair wage, they’re able to provide for their families without public assistance. Fair wages empower working families to buy cars, homes, appliances, and clothing. In fact, every dollar spent on prevailing wage jobs is estimated to generate $1.50 for local economies.
There are real challenges facing the construction industry in 2025, but PLAs and basic labor protections for workers aren’t on that list.
Any serious discussion about improving the industry has to start with recruitment – and how we attract a new generation of qualified workers into construction jobs. Unions are working overtime to meet the challenge – sponsoring programs at high schools, apprenticeships, working with veterans’ groups, as well as our Sisters in the Brotherhood initiative that encourages women to pursue careers in the building trades.
One thing we aren’t doing is advocating wholesale reductions in pay and benefits, like the folks on the anti-union side of the debate.
I’m a carpenter, not an economist, but I know that cutting pay for working class New Yorkers isn’t going to solve the affordability crisis in New York State.
Stimulating New York’s economy and investing in local economies has never been more important than right now. The best way to do that is by putting well-trained, highly-skilled New Yorkers to work.
Bill Banfield is the assistant executive secretary-treasurer North Atlantic States Regional Council of Carpenters.
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