Have you ever been on a worksite where you noticed this dynamic: People of color made up a majority of the laborers and tradesmen, white men made up the vast majority of the designers and managers, and there was not a woman in sight? Have you ever asked yourself: Is this dynamic going to stay the same forever? Could the answer be: Dinosaurs are extinct because they failed to adapt?
The Case for Diversity
The case for diversity has been made at all levels of business and in every industry—from the C-suite to the custodial staff; from rocket scientists to cafeteria workers—everyone recognizes why it is important to have multiple viewpoints and diverse life experience to be successful in business. For construction, however, it seems this recognition has not translated into actual implementation of policies designed to increase minority and female participation.
The pool of experienced talent in construction has dwindled in recent years. The decade-long recession starting in 2008 hit the construction industry hard. Tough times forced many professionals and tradesmen to leave their fields for other work, and many did not or could not return since the turn-around. In addition, Baby Boomers in the industry continue to age out and/or retire. COVID-19 has and will continue to take a similar toll on the construction workforce. Women and minorities can and should be tapped to fill these voids.
The definition of insanity is doing the same thing over and over again and expecting different results. When the same people do the same thing the same way for generations, nothing ever changes for the better. Construction is a problem-solver’s job. A recognized benefit of embracing diversity is the ability to collect different perspectives and outlooks that increase creativity and improve problem solving. Using an array of workers, managers and executives can change the mindset of the industry and provide new approaches for project needs.
Productivity on projects is key. A uniform workforce can be a liability when unexpected circumstances occur such as COVID-19. Diversity allows for maximum flexibility and increased probability of productivity. As a simple example, remember coal-mining towns where all of the workers in the mine were from one town? If that town had a flood that prevented the workers from leaving town to get to the mine, the mine could not produce. Where a project is staffed with people from all walks of life, they are less likely to be collectively stymied by unforeseen circumstances.
Project owners and developers are becoming more diverse, and they want to see diversity in the firms they hire to complete their vision. Diversity also allows firms to meet the complex needs and expectations of non-traditional owners and developers, growing the firm’s market and reputation. Similarly, inclusion promotes goodwill, good publicity and good corporate morale. A firm’s reputation for adopting and implementing diverse initiatives differentiates it from the competition.
Dreary Statistics on Construction Industry Diversity
According to the National Association of Minority Contractors, of the 160 million people employed in the United States, more than 31% or 50 million people earn a living in the construction industry. Of these workers, Hispanics and Latinos make up 30% or 15 million people and African Americans represent 17% or 8.5 million people. In 2018, construction spending in the United States topped $1.29 trillion and in 2017, construction accounted for about 7% of US GDP. The construction industry is predicted to see an employment growth of 13.6% or almost 520,000 new jobs by the year 2024. Yet, 90% of contractor firms are concerned over labor shortages.
The U.S. Bureau of Labor Statistics reported that in 2019, 90% of construction managers were white, 10% were women, 3.5% were African American and 2.5% were Asian. Architectural and engineering managers were 88% male and 91% white; first-line supervisors were 88% white and 96% male; masons were 99% male and 92% white; carpenters were 90% white and 96% male; operating engineers were 98% male and 85% white; electricians were 97% male and 87% white; and construction and building inspectors were 90% male and 82% white. Of the 40 trades listed under the construction and mining category of the US Bureau of Labor Statistics, more than half of the trades did not include enough women to muster up a statistically significant percentage in 1996 or 2019. These included such in-demand trades as plasterers and stucco masons, iron and rebar workers, and even solar panel installers. Unfortunately, these statistics have not varied substantially over time: The percentage of women in construction has hovered around 10% since 1996.
However, these findings do not tell the whole story. An analysis of the 2010 census information in New York City (five boroughs) found that only 40% of the construction workforce of 224,500 people were white, while 36% were Hispanic and 14% were Black. The 2010 census statistics are significant because they reflect a pool of survey participants that includes unionized and non-unionized labor, blue-collar and white-collar workers, and employees working “off the books.” In addition, apparently 39% of the NYC construction industry workforce and 45% of all construction trade workers were non-U.S. citizens in 2010. It will be interesting to see what the 2020 census data reflects.
Why Are the Diversity Statistics so Dreary?
Given the lack of change in the statistics regarding homogeneity in the construction industry, systemic forces are definitely at work. Certainly, construction roles have traditionally been filled by men, so some women might find the work environment intimidating. Law suits alleging workplace discrimination and sexual discrimination in the industry are ubiquitous. For example, in July 2020, 18 employees received a settlement of $1.5 million against Trade Off Construction Services, a construction services employment firm based in Long Island—New York State’s first-ever sexual harassment settlement in the construction industry. Apparently, Trade Off managers demanded sexual acts from several female employees for pay and overtime opportunities, sent female co-workers explicit photos and videos, failed to take action in response to complaints, and repeatedly protected harassers from punishment. The company fired at least a dozen female employees after they filed harassment complaints.
Similarly, in September 2020, four Black construction workers in the escalator and elevator division of Mitsubishi Electric US sued the company in California Superior Court for alleged racial discrimination. The workers complained they were harassed by their supervisors with racial slurs and images and were discriminated against when it came to opportunities for training, higher pay, overtime and advances in their careers.
The construction industry has experienced some of the same turmoil the country has faced this summer. With reports of nooses and offensive graffiti being placed in eyeshot of targeted workers across the U.S., contractors have been dealing with an extra layer of issues at the same time that the global COVID-19 pandemic has affected current and future projects. Some construction companies have rallied to the forefront and embraced inclusiveness when faced with such blatant racist activities. For example, Turner Construction Co. shut down two large Ohio projects to conduct anti-bias training after the company discovered graffiti containing discriminatory slurs around those jobsites. More construction companies should follow suit.
Ideas for Change
Supplier diversity is on the rise. For the construction industry, government-based projects have come to include a component of mandated inclusion for underrepresented groups. For example, the U.S. Department of Transportation’s Disadvantaged Business Enterprise (DBE), Small Disadvantaged Business (SDB) and Women-Owned Small Business (WOSB) programs were designed to help these businesses compete fairly for federally-funded projects. State and local governmental agencies around the country have similar programs.
However, programs focusing solely on “ownership” have come under fire as unethical companies can exploit the requirements by appointing “token” women or minorities as “owners” of a business to obtain credentials. There is also a heightened risk of companies receiving work that they are not qualified or experienced for simply by meeting the diversity mandate. Respected credentialing agencies and compliance with opportunity requirements are needed to overcome these barriers.
Furthermore, apprenticeship opportunities are key for filling the pipeline of talent. For example, Boston’s Residents Job Policy states that private development projects over 100,000 square feet and any public projects must meet certain “quota” requirements. These include that 40% of the total work hours of journeymen and apprentices in each trade must go to people of color and at least 12% of the total work hours of journeymen and apprentices in each trade must go to women. The City shares best practices for hiring and recruitment and runs an online jobs bank to connect workers to construction jobs. However, the target numbers are not being met, where women represent only 5% of the hours worked on construction projects in the city in 2018. Out of 191 construction projects in Boston in 2017, only five met all of the Residents Job Policy benchmarks, and none of them were the biggest projects in the city.
It is obvious that construction’s current approach is not sustainable. Actual change needs to come from policies and initiatives tailored to the industry, not merely platitudes. It is the duty of leaders in construction to advocate for a more diverse and inclusive workforce, or else the industry as we know it could move from endangered to extinction.
Reprinted with permission from the October 21, 2020 issue of The New Jersey Law Journal. © 2020 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.”