2014 Legislative Conference - President McGarvey Keynote Address
North America’s Building Trades Unions
2014 Legislative Conference
March 10, 2014
Washington Hilton and Towers Hotel
Brothers and Sisters...ladies and gentlemen...
It is my pleasure to welcome you to the 2014 Legislative Conference of North America's Building Trades Unions.
Before I begin, I want to take a moment to thank all of you for being here. It’s been a long, difficult winter for many of you. So, I thank you for going the extra mile to make the effort to be here.
For the better part of a decade now, our unions have been building a strategic foundation for market share success.
We have taken a long, hard introspective look at how we do business; we have instituted a comprehensive cultural change that is predicated on pride, performance and professionalism; and we have systematically analyzed our strengths and weaknesses in order to maximize the former while minimizing the latter.
And now we stand here today, Brothers and Sisters, armed with the twin pillars of our strategic approach to doing business that will enable us to successfully capitalize on the oncoming construction boom in the United States over the next ten to fifteen years.
The video that you just saw demonstrates the core elements of those two pillars.
Number one, our unmatched ability to bring bottom line value through the formal development and training of the safest, most highly skilled and productive construction workforce in the world.
And number two, our commitment to building partnerships that lead to the creation of pathways for people of all walks of life who deserve an opportunity to achieve a stable and secure life in the American middle class.
Brothers and Sisters, let me be clear:
Our unions today stand upon the threshold of a once-in-a-lifetime opportunity to secure significant market share gains for the union construction industry.
But, in order to do that we have got to work harder, smarter and more strategically than ever before.
And what I said to you last year at this conference, bears repeating again this year. If what we are doing does not maintain or grow our market share, then we must question why we are doing it.
The most important take-away from the video you just watched is this:
In order for us to be successful, we need to cultivate partners. And if we are to spearhead a great renaissance for the union construction industry across North America, then we must accept and embrace the need to be smarter and more strategic in how we build those partnerships that lead to business opportunities for our members and our unions.
All of us in this room are proud trade unionists.
And rightfully so.
All of our unions have strong and proud traditions and values that relate to protecting the interests of our members, their families and the American middle class.
And that will never change.
But, we should also never be afraid of innovation and transformation.
Because any way you slice it, brothers and sisters, success in our world revolves around business relationships.
If all of us in this room today can embrace change and innovation, and commit to pulling in the same strategic direction, then we will realize significant market share gains and secure them for generations to come.
Whether it's our pre-apprenticeship and apprenticeship programs, our "Helmets to Hardhats" program, or our "codes of conduct" and "codes of excellence," our unions today are collectively helping to move the needle of industry and social change further in our direction.
And when we become more adept at leveraging our political resources, our capital financing resources, and our community outreach resources, then we will have created the type of fundamental synergy we need to lock in market share gains in every region and state in this great nation.
And today, Brothers and Sisters, I already have good news to report.
It gives me great pleasure to report to this Conference today that North America's Building Trades Unions will embark upon this momentous and strategic mission with the full participation and brotherhood of the International Union of Operating Engineers!
To me, nothing sounded better this morning than to hear the roll call of the dais and hear the name, Jim Callahan, General President of the International Union of Operating Engineers.
Jim, it's great to have you and the OEs back! And I want to publicly thank you and the leadership of the Operators for maintaining close ties with the Department over the last few years.
Brothers and Sisters, getting our Building Trades family back together is, indeed, an important step. Now, we must focus on the fundamentals.
I'm talking about basic blocking and tackling.
As I travel across North America to meet with our members, building trades leaders, heads of industry, and political and community advocates, the one single impression I always strive to leave them with is this:
Today's building trades unions are change agents.
We are about cooperation... not conflict.
We are about collaboration, not division.
We are about inclusion... not exclusion.
And we seek to use our knowledge, our expertise and our resources to SOLVE problems; not CREATE problems.
So, let's talk a little about what I mean by blocking and tackling.
Number one, the way we engage in politics.
When you look at the combined political resources of our affiliated unions, as well as our state and local building trades councils, and I'm talking about money and manpower, there is nobody in the labor movement that compares to us.
Now, that size and strength doesn't amount to much if we are not being smart and more strategic in terms of how we leverage and apply those resources.
We are not running a charity, brothers and sisters!
Our political support must be tied to outcomes.
Now, government and politicians are an important factor in our success, but that's just it, they are only one factor in our success.
We have got to be smarter about leveraging other assets that we possess.
Take, for example, our pension fund assets.
And I will shout this until I am blue in the face:
If your union is not investing a portion of its pension fund resources into those funds that are actually helping us secure projects and put our members to work, then I suggest you re-examine your allocations!
I don't care what some of the investment consultants say, you can generate a comparable rate of return on your investment and put our members back to work at the same time by investing in funds like the Housing Investment Trust and Building Investment Trust, ULLICO's J for Jobs and Infrastructure fund, the Multi-Employer Property Investment Trust, Nuveen's Municipal Infrastructure Fund, or the IBEW's National Real Estate Advisors, to name just a few.
In far too many cases, we have situations where some pension investment consultants are acting like we don't deserve to have input in the process.
But, it doesn't work that way.
Our investment consultants WORK FOR US!
WE DON'T WORK FOR THEM!
What we need to do is alter the dynamic in terms of how we work with Wall Street. The idea is to better influence and interact with potential partners on Wall Street, so that they are working in our best interests.
In many instances today, some consultants are pushing your funds to invest in corporate bonds that support some of the most anti-union and anti-worker companies in America.
We could get the same rate of return by investing in some of those funds that put our members to work.
Now, I ask you: What makes more sense to you?
So, the time has come for all of us to re-assess the role of some of these professionals that are employed to oversee our funds.
And to help guide you, the Building Trades is in the process of developing a new program designed to analyze and rate the investment consultants of Taft-Hartley plans so you will have better information on which to base your decisions in terms of the professionals THAT YOU HIRE to advise your funds.
This is critically important, Brothers and Sisters, because I can tell you that we are beginning to have success all across this nation in gaining the attention of developers and local governments who are seeking financing options and partners for their projects.
And when we are able to assist them through funds like ULLICO's, the Housing Investment Trust, and others...
We are then able to influence the labor strategy on those projects!
All across America today, in metropolitan areas large and small, we are blocking and tackling with success like never before. We are leveraging our assets and resources in order to build partnerships and cooperative arrangements within our own industry, within the local political arena, and within local communities.
It's not complicated, brothers and sisters, it's simple fundamentals.
For far too long, we have been focused on trying to throw a Hail Mary pass; something that would get us a quick touchdown.
But, as every football coach will tell you, it's a dedication to the fundamentals of blocking and tackling that win games and championships but can also, in our case, provide the foundation for the broader goal of social and cultural change.
And that is a very important point.
Because after all, greater market share combined with social and community change is what we are after.
As the American economy begins to improve, there are signs that a cultural shift is beginning to take shape. You can sense it in the increased attention and discussion involving wealth inequality and the issue of the federal minimum wage.
It's an opening that we should seize upon.
Project labor agreements are a good example.
As a matter of practice, we are crafting public and private PLAs that include some variation on what we call "community workforce" provisions. These provisions are specifically designed to provide career training through our apprenticeship programs that then create ladders of opportunity to help people get to the middle class, for the exact same disadvantaged communities that have long been ignored by lawmakers - unless of course those communities attempt to exercise their right to vote!
And, oh by the way, it is always worth noting to public officials that our apprenticeship and training programs which provide "earn while you learn" opportunities are funded to the tune of over $1 billion a year in private contributions by our members and our contractors.
No taxpayer money is involved!
Brothers and Sisters, it makes sense in today's world to use the energy and force of cultural change to advance our own, market-based solutions to address some of the problems affecting industry, government and communities at large.
Now, let's be clear. We still have our fair share of hurdles to overcome.
And at the top of the list are two major issues that carry with them significant potential to hinder our growth.
The first is immigration reform.
As most of you know by now, for the time being we have managed to curtail the desires of some in the business community to create a new, virtually unrestricted, foreign guest worker program.
Thanks to the tireless efforts of our Government Affairs Director, Sonia Ramirez, and her colleagues from our affiliated unions, the Senate version of immigration reform was carefully crafted to include an annual cap of 15,000 guest workers for the construction industry.
That was a very significant achievement.
We support comprehensive immigration reform that is rooted in dignity and respect, and NOT a race to the bottom coupled with further exploitation.
But, what the House of Representatives may do is anyone's guess at this point.
So, I encourage all of you to attend the Legislative Issues workshop being conducted by Sonia tomorrow afternoon at 1 p.m. here in this ballroom.
The second issue that possesses such great potential for impacting our growth prospects is multi-employer pension reform.
In the first decade since the turn of the century, we have suffered through two catastrophic financial meltdowns that contributed to two recessions that led to a depression in the construction industry and unprecedented challenges for some multiemployer pension plans.
Today, the liability pressures being placed upon some of our signatory contractors are not sustainable.
And that has the potential to severely curtail our growth prospects.
In response, the union construction industry and others have crafted a set of private sector solutions to address the challenges being faced by some of our plans while simultaneously strengthening the multiemployer, defined benefit system for existing retirees and future generations of participants and sponsoring employers.
These recommendations are now in the process of being converted into federal legislation that we intend to shepherd through Congress.
This afternoon, Randy DeFrehn will be conducting a workshop that will provide the latest information about this effort.
Brothers and Sisters, every year when I address this conference, I try to offer some sort of historical perspective that can tie into the challenges that our unions are facing.
After all, the lessons of the future can always be found in the past.
How many of you here today have ever heard of British Admiral Horatio Nelson?
Admiral Nelson commanded the flagship HMS Victory for the British Empire during the Napoleonic wars.
During the decisive battle of Trafalgar, Admiral Nelson and the British Navy found themselves engaged with the combined naval forces of France and Spain -- two of the greatest naval forces at that time.
Nelson subsequently signaled all the necessary battle instructions to his ships.
But, because of the momentous task they were about to face, Nelson felt that something extra was required.
He instructed his signal officer, Lieutenant John Pasco, to signal to the fleet, as quickly as possible, the following message:
"England expects that every man will do his duty."
And when the smoke cleared, they had engineered the most decisive naval victory of the war.
The point I'm making Brothers and Sisters, is that we stand today upon a momentous moment in our battle to position our unions as preferred workforce vendor/supplier for the construction industry.
And just as Lord Nelson commanded that "England expects every man to do his duty,” we must establish similar levels of expectations within our own ranks.
Our contractors expect us to deliver day in and day out on the job.
Our owner and end-user partners expect us to deliver "on time, on budget" results on a consistent basis.
Our government and community partners expect us to be inclusive and forthright in building pathways of opportunity.
And along with the gentlemen who join me on this stage today, we must all embrace the basics of success that we are outlining to you this week.
Number one, we must continue to invest in an internal culture shift that places pride, performance, and professionalism at the top of our priority list.
Number two, we must do all that we can to demonstrate how our value proposition brings bottom-line advantages to our potential partners in business, government and in the community.
These are the expectations that are driving our strategy within and along the Gulf Coast.
Although the impact and opportunities associated with the development of our nation's natural resources are being felt across the country, if there is an epicenter for this activity, it is along the Gulf Coast.
Our determination to spread our idea of partnership and value, and to secure increased market share, is centered along the Gulf Coast.
We have set about to systematically demonstrate to the decision-makers in the oil, gas, petro-chemical and other growth industries that we have the desire, the ability, and the wherewithal, to become productive partners that deliver value to their bottom line concerns.
Right now, we are already assisting these industries with various legislative and regulatory challenges that they are having.
We have recently developed a new Gulf Coast project labor agreement that maximizes our competitive position while ensuring that our members will continue to enjoy family-sustaining wages and benefits.
We are boosting our investments in workforce development in this region to satisfy the unprecedented demand for skilled craft labor over the next 10-15 years.
And with the support and approval of the Governing Board of Presidents, I am today announcing that, effective April 1st, the Building Trades will open a new office in Houston, Texas.
This will the first new office we have opened since our Tennessee office was opened in the 1980s.
This office will be fully staffed with a market development professional...
a Building Trades professional...
and a military veterans advocate.
Brothers and Sisters...
what I am saying to you is this:
On April 1st, we will firmly plant the Building Trades flag in the heart of the Gulf Coast!
And we are already beginning to experience accelerated growth with our contractor base in this region.
What we are doing along the Gulf Coast and elsewhere across the nation, is figuring out what the key-decision makers in industry, government, and in the community need to be successful, and figuring out ways to work with them to ensure that they are successful.
And in so doing, we hope to spark a compelling conversation.
Something that goes like this:
On time, on budget results with quality workmanship? The Building Trades can do that.
A steady supply of the world's safest, most highly trained and productive workforce critical to your capital construction needs? The Building Trades can do that.
Deploying an effective political, legislative and regulatory operation that can assist companies and industries with issues that affect their bottom lines? The Building Trades can do that.
The ability to create structured career training pathways for minorities, women and military veterans? The Building Trades can do that.
Brothers and sisters, let me finish by saying this to you:
What's in front of us here in America today, is what our brothers and sisters in Canada were facing over 10 years ago.
Thanks to a disciplined commitment to the strategic approaches I have outlined here today, our Canadian brothers and sisters have experienced tremendous membership growth and today are looking at over half a trillion dollars worth of work ahead in just the next 7 years.
And lest anybody believe that our unions here in the States are operating from a position of weakness, let me just say this:
Over the last 6 years, we were knocked to our knees.
But today, I'm happy to report that we are once again back on our feet.
And in 2013, a year in which virtually all segments of the labor movement lost members and declined in market density according to the Bureau of Labor Statistics year-end report, the building trades actually increased its collective membership by roughly 95,000 members.
And I want you to think about this...
If you exclude residential from the data and look at Commercial, Institutional, high-rise housing, heavy and highway and industrial, our market density across the United States now stands at close to 40%.
These recent membership gains are only replacing at this point, the losses of the last six years. And our current market density, although going in the right direction, still leaves us a steep mountain to climb as we seek to re-establish ourselves as the preeminent provider of value and service in the U.S. construction industry.
Brothers and Sisters, the stars are now aligned for us.
But, we will realize success only if we continue to focus on the basics of blocking and tackling.
For example, if you do not have a contractor base in your area to competitively bid all the work, then we aren't even in the game. So, that's job number one, to re-build our contractor base.
And in order to do that, we need to undertake a process of self-examination. We need to conduct thorough research that examines what our market deficiencies are as well as to identify future opportunities that could lead to market share gains.
Further, we need to conduct an assessment of our relationships with community leaders in any given market.
How do they view us?
Are there any existing relationships that we can build upon?
Are there stereotypes that still need to be overcome?
What will it take for our unions to build solid partnerships and increased political support for our community workforce programs so that we can achieve the twin results of increasing market share while simultaneously building hope for many people who have not had much hope in their lives?
And equally important, we have to ask ourselves whether we have sensible and effective political strategies that include engagement with elected officials and political appointees OF BOTH PARTIES?
Are there opportunities for us to get building trades representatives appointed to important boards, commissions, and task forces?
And are there opportunities to get our own leaders and members elected to office?
I ask you this:
Does anyone doubt that having Marty Walsh as the Mayor of Boston, will have anything but a positive effect on our members, and all working people in Boston?
And finally, let us always remember that the single most effective thing we can do right now to help spread the idea of the Building Trades' value proposition is to invite construction owners, contractors, lawmakers, public officials, and community leaders to visit and tour a craft training facility in your area.
I can tell you that on each and every such tour that I have been a part of, without fail I will hear some version of this response:
"I had no idea that this is what you all do."
Brothers and Sisters, it's important that we leverage our investments in training to drive this point home with politicians.
Sure, we can vote to endorse a candidate at the union hall. But, when it comes time that a candidate asks for our financial support don't miss the opportunity to arrange a visit to one of our world-class training centers to show them what we do!
So, there you have it, Brothers and sisters. It's all right there in front of us now.
All we have to do is to work smarter and be more strategic and do all that we can to get our idea to spread.
Blocking and tackling.
But, I don't want any of you thinking we can do this half-assed and still win.
We've got to do this right; we've got to do this together; and we've got to it ALL THE TIME!
As the great Vince Lombardi once said: "You don't win once in awhile; you don't do things right once in awhile. You do them right all of the time. Winning is a habit!"
Brothers and Sisters, great moments are born from great opportunity.
Now is the time for us to get in the habit of winning ALL THE TIME!
Thank you, God Bless You, and may God Bless North America's Building Trades Unions!