A basic tenet of the American Dream is that if you work hard and play by the rules, you can earn enough money to make a decent living and take care of your family. That’s becoming harder and harder to do in the construction industry, where shady employment practices are becoming the norm. The impact goes far beyond the industry. When employers cheat their workers, the burden shifts to government to take care of working families.
Taxpayers shouldn’t be forced to pick up the slack for unscrupulous contractors. It’s time to clean up the construction industry, for workers and for all taxpayers.
Historically, the construction trades have been a pathway to the middle class for anyone willing to work hard — and that’s still the case for members of unions. Unions are able to collectively bargain for good wages and work with employers to provide access to family health care, retirement benefits and career training. Nonunion workers don’t have those protections, and the entire industry is suffering because of it.
According to a report released earlier this month by the University of California Berkeley Labor Center, the decline in unionization in the construction industry has created a void that hasn’t been filled: “Without government intervention, construction workers should expect to continue to be exploited and cheated, and lawful contractors should expect to find it more and more difficult to remain in operation.”
According to the report, 39% of construction worker families nationwide are forced to enroll in one or more safety net programs to make ends meet. The yearly cost to state and federal taxpayers is a staggering $28 billion — to cover reliance on Medicaid, the earned income tax credit (EITC), temporary assistance for needy families (TANF) and the supplemental nutrition assistance program (SNAP). Working families in the construction industry are 26% more likely than all working families to utilize safety net programs, and nearly one-in-three construction workers (31%) lack health insurance.
Every day, hard-working men and women put in a full day’s work at an exhausting construction job and then still have to rely on government assistance to put food on the table. How does that happen? According to the researchers, it’s because of low pay, wage theft and illegal employment practices in the construction industry.
We know that wage theft is a serious problem right here in New York. Just last month, a contractor on Long Island was ordered to pay nearly $1 million in back pay and damages to 99 workers the company had cheated out of overtime pay the workers had earned.
According to the state Labor Department, more than 250,000 workers have been victimized by wage theft since 2011. That adds up to $1 billion in lost wages every year. Thankfully, leaders in Albany are taking steps to crack down on the problem; a bill passed last year and signed into law by Gov. Hochul will make it harder for bad actors to hide behind layers of bureaucracy to evade accountability.
But that’s just the start. The bigger problem is that the construction industry rewards low-road employers who turn a blind eye to mistreatment of blue-collar workers. Illegal business practices such as misclassifying workers to avoid paying benefits have become commonplace. Contractors who play by the rules end up penalized and unable to compete, creating an uneven playing field that rewards bad behavior.
The good news is that when unions collectively bargain, they advocate for industry-wide standards. Jointly administered apprenticeship funds develop a skilled workforce for the future while providing career opportunities with excellent classroom and on-the-job training, but without education debt. Benefit funds allow employers to provide affordable, comprehensive health and retirement benefits to members, which are portable between employers. When strong unions and sufficient industry regulation are in place, even nonunion companies must respect union-set industry standards or risk losing their employees to better opportunities.
This report demands action, and it should be a wake-up call for the construction industry, policymakers and law enforcement. It’s time to restore a piece of the American Dream for blue-collar workers.
Banfield is assistant to the executive secretary-treasurer at the North Atlantic States Regional Council of Carpenters, a union.
