President Biden’s Project Labor Agreement Executive Order Will Increase Costs to Taxpayers and Exacerbate Construction Industry Skilled Labor Shortage

0 February 4, 2022  Featured, Federal Construction

Yesterday, Associated Builders and Contractors issued this press release in reaction to President Biden’s long-rumored executive order (see White House fact sheet) pushing government-mandated project labor agreements on certain federal construction contracts. This policy is bad news for taxpayers and the construction industry.

President Biden’s Pro-PLA Executive Order Will Increase Costs to Taxpayers and Exacerbate Skilled Labor Shortage, Says ABC

THURSDAY, FEBRUARY 3, 2022 7:49 PM

WASHINGTON, Feb. 3—Associated Builders and Contractors today blasted President Biden’s executive order that encourages the use of controversial project labor agreement mandates on federal construction projects that are funded by taxpayers.

“President Biden’s new policy will not help America ‘Build Back Better;’ instead, it will exacerbate the construction industry’s skilled workforce shortage, needlessly increase construction costs and reduce opportunities for local contractors and skilled tradespeople,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “This anti-competitive and costly executive order rewards well-connected special interests at the expense of hardworking taxpayers and small businesses who benefit from fair and open competition on taxpayer-funded construction projects.

Research has demonstrated that government-mandated PLAs increase construction costs by 12% to 20%, which results in fewer construction projects and improvements to roads, bridges, utilities, schools, affordable housing and clean energy projects—and the creation of fewer jobs,” said Brubeck. “PLAs steer contracts to unionized contractors and workers at the expense of the best-quality nonunion contractors and workers who want to compete fairly at a price best for taxpayers.

“PLA mandates are bad public policy because they effectively exclude the nearly 9 out of 10 U.S. construction workers who choose not to join a union from building taxpayer-funded construction projects,” said Brubeck. “These controversial agreements hold a third of employees’ compensation for ransom unless they join a union, pay union fees and prop up struggling union pension plans. PLAs also create excessive cost burdens and risks for high-performing nonunion contractors, which built more than half of the federal government’s large-scale construction projects during the past decade and are more likely to be small, women- and/or minority-owned businesses.

“Because 87.4% of the construction workforce does not belong to a union and the construction industry faced a skilled labor shortage of 430,000 people in 2021 alone, the Biden administration would be best served by promoting inclusive, win-win policies that welcome all of America’s construction industry to realize the potential of the recently passed Infrastructure Investment and Jobs Act to rebuild our nation’s crumbling infrastructure, increase accountability and competition and reduce waste and favoritism in the procurement of public works projects,” said Brubeck.

The Biden administration has also recently enacted new policies encouraging government-mandated PLAs on private, state and local government construction projects receiving federal funding through the U.S. Treasury, Transportation, Agriculture and Interior departments, which has resulted in push back by GOP governors.

ABC and a diverse coalition of construction industry, small business and taxpayer advocates have been asking lawmakers to oppose PLA schemes and cosponsor the Fair and Open Competition Act (S. 403/H.R. 1284) prohibiting PLA mandates on federal and federally assisted taxpayer-funded construction projects. Similar pro-taxpayer legislation has been enacted in 24 states.

To learn more about how corrupt government-mandated PLAs rig the competitive bidding process, hurt taxpayers and endanger plans to rebuild America’s infrastructure, visit buildamericalocal.com.

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