Construction Workforce Shortage Disproportionately Impacting Nonunion Firms

A review of 2018-2021 Associated General Contractors of America (AGC) surveys of more than 5,000 member firms nationwide reveals that nonunion construction firms are facing significantly greater workforce supply problems than their union counterparts, and that these problems preceded the COVID-19 pandemic. The surveys, which include responses from 1,768 union contractors and 3,893 nonunion contractors, were analyzed by researchers from the nonpartisan Illinois Economic Policy Institute (ILEPI) and the Project for Middle Class Renewal (PMCR) at the University of Illinois at Urbana-Champaign.       

The Associated General Contractors of America represents more than 27,000 construction firms nationally. It releases its survey data each September and, since 2018, has released data specifically on union firms and nonunion firms. While ILEPI and PMCR’s analysis of survey responses showed nearly identical levels of concern between union and nonunion segments on supply chain and regulatory issues, it revealed significant differences on workforce matters. Specifically, it showed that nonunion firms were an average of 16% more likely to report difficulty filling open positions, 13% more likely to report losing skilled workers to other industries, 21% more likely to report project delays due to workforce supply or retention issues, and 27% more likely to report their local workforce training pipeline as “poor” compared to their union signatory peers (Table).

“While a tight labor market is clearly impacting the entire construction sector, the data shows that these issues are far more acute in the nonunion segment of the industry,” said ILEPI Executive Director and report coauthor Frank Manzo IV. 

The researchers noted that AGC’s survey results came at the end of a period that saw job quality both inside and outside the construction industry eroded through the adoption of so-called “right to work” laws designed to reduce union density and the repeal of state prevailing wage laws, which establish minimum wage and training investments on publicly funded construction projects.

“With our nation poised to spend more than a trillion dollars on new infrastructure over the next decade, the demand for skilled construction workers is only expected to grow in the years ahead,” Manzo concluded. “AGC’s survey data tells us that the industry can no longer afford to view unions and policymakers who advance labor standards as an adversary—but rather as a partner in attracting and retaining skilled workers without whom our economy cannot function.”        

For more information, read the full report, The Union Advantage During the Construction Labor Shortage: Evidence from Surveys of Associated General Contractors of America Member Firms.