Market Share/Non-Union Competition

Q:  Historically, what percent market share goes union in the Oregon area?

A:   40% of plumbing and pipefitter work is performed by union construction workers according to the Construction Labor Research Council (CLRC)

Please click here for the CLRC data:

Q: The data shows that we have fewer people working, our benefits cost more each year, and the non-union firms are taking our market share.  Is this true?

These long term trends of reduced union employment (and concentration in urban specialty markets) create a negative cycle and point to several difficult realities for our industry.

  • Reduced plumber and pipefitter employment strains retirement, apprenticeship, and healthcare trusts that are dependent on man-hours to meet future obligations
  • To counter this trend, wages and benefits are increased to “catch up.”   These dramatic wage package increases put union contractors at a cost disadvantage to non-union firms
  • This strain is evidenced by the 40% reduction in PMCA Member Contractors over the past 15 years.
  • With fewer contractors bidding work, the non-union sector goes unchecked and is allowed to grow and increase its market share

Q:  What is local 290′s goal for market share over the next 7 years?

A:  There is not a formal goal published at this time.

Q:  What major contractors have been organized (converted from non-union to union) or newly established in the last 5 years?

A:  No major contractors have been converted or organized in the last 5 years.  The number of employers has dropped from over 250 to 139.

Q:  Who are the largest non-union employers in the area and what jobs have they recently won?

A:  The largest non-union employers in the area include:

Please see their websites for additional information.

Q:  What major projects were built non-union?

A:   Major projects include:

  • Oregon State Hospital
  • University of Oregon Matthew Knight Arena
  • Sandy HS.

Q:  How big are these jobs and who is hiring them?

A:   Over the past 2 years, a record amount of large projects including several in excess of $10mm have been awarded to non-union contractors by top tier GC’s.

Q:  What happens if we present our customers with large wage increases, costly new work rules, or the threat of strikes and pickets?

A:   Customers handle their money like most people handle their personal finances.

  • They want to know they are getting a good value when they buy something.
  • They don’t like seeing inefficient rules that slow things down.
  • If you don’t show up or aren’t dependable, they will find other people that they can count on.

Our customers always have choices and if we push unnecessary problems on them, they will find non-union alternatives.  It’s never a good idea to poke a bear.

Q:  Can you give me an example of another UA Local and their Contractor Association that has taken progressive steps to jointly grow marketshare?

A:   Yes.  District Council 16 in Los Angeles and the CPMCA have undertaken a joint effort to increase the union marketshare in their region by 25% in 10 years.  Please see 2 of their slides below which outline their philosophy on marketshare and recent negotiation goals.  We will make more information available soon on this innovative partnership.

Q:  I’m concerned about the future of union construction and its ability to capture market share (and pay for my future pension).  What strategies are out there to increase market share for the union worker and contractor?

A:  The MCAA commissioned the attached study to highlight the best practices related to regaining market share.

Click here to read the MCAA White Paper.

Some of these strategies involve drastic changes and others require an improvement in teamwork between labor and management.

All of the recommendations will require effort from both sides and a willingness to work together to change and grow our industry.

Q:  What are the Top Strategies for Regaining Local Market share based on this MCAA White Paper study?

  1. Improve craft productivity through training, recruitment, and progressive discipline of consistent poor performers.
  2. Reduce crew costs with differential wage rates and sub-journey worker classifications.
  3. Allow portability of union member manpower across local union jurisdictional boundaries without restriction or prior approval.
  4. Allow unrestricted importation of union-fabricated piping assemblies of all types across local union jurisdictional boundaries without restriction or prior approval.
  5. Adopt the Standard for Excellence.
  6. Promote UA/MCAA Foreman Training and Certification Program.
  7. Implement accelerated training and direct entry of pipe trades workers.
  8. Update/adopt Substance Abuse and Testing Policy in line with the CURT/BCTD work product.
  9. Incorporate an arbitration clause with a no-strike/no lockout pledge to limit customer disruption during contract negotiations.
  10. Address disparities in overtime pay between the union and non-union construction worker.
  11. Update the apprenticeship system to appeal to the new workforce.

Q:  What are the Greatest Barriers to Regaining Market share based on this MCAA White Paper study?

  1. Local management/multiemployer bargaining units function as weak, fractured, and compliant bargaining partners
  2. Local labor groups have exploited bargaining advantages with owners under project and national agreements to serve short term political interests.
  3. A Regulated Fringe Trust threatens the viability of contributing employers.
  4. Full employment complacency cedes an increasing market share to open shops.
  5. Political dynamics of Local Union leadership.
  6. Restrictive Hiring Hall Rules and Regulations