Labor

Unions Are At A Critical Crossroads

By Mark Breslin

	BRESLIN

Due to political, economic and strategic shifts in the marketplace, organized labor faces very hard choices that will reverberate for decades to come. Labor must choose between two starkly different paths. One is to embrace a fundamental change in strategy and structure that leads to new partnerships and increased market share. The other is to stick with the status quo and inertia, leading to unions’ final demise and irrelevance. It is my view that the successful retooling of unions can provide significant added value to our industry. But it is incumbent upon them to embrace the principles of a modern business partnership to make this a reality.

As a business enterprise by any measurable criteria, organized labor has failed dismally over the past three decades. Union market share losses exceeded 50% as turmoil, graft and self-interest crippled unions’ market attraction and they wallowed in self denial. For their future, this is actually good news. As an alcoholic must hit bottom before facing reality, these market share losses finally have given rise to honest self reflection.

Even the rank and file know that the "good old days" are not so good anymore. This, in turn, has given rise to a new generation of union leaders. Much more CEOs than traditionalists, this group understands the necessity of taking a professional business approach. They are focused on client needs, return on investment and partnering with employers. These labor leaders must now drive change and demand performance, integrity and accountability. Although the black sheep of labor still get the press coverage, there are many indications that fundamental and positive changes are becoming the rule rather than the exception.

Even the most optimistic turn-around specialist would confirm that the obstacles to change and growth are formidable. A change in strategy from provocation to partnering is occurring, but too slowly. A focus on client needs and business planning has been adopted, but results are hard to quantify.

A change in union culture finally is recognized as being necessary, with quality, productivity and value as the new foundation. As John F. Kennedy said, "Change is the law of life." Labor leaders who are unwilling to embrace this truth will shortly pay the price of extinction.

Survival of the Fittest

Construction unions now recognize that they will be judged by the least progressive or productive of their peers. By ruthless or cooperative execution, structural change must also come to labor’s market approach. Union mergers must occur to meet ongoing end-user needs, eliminate inter-union conflict and leverage economies of scale. Unions will either choose to consolidate along complementary lines to meet market needs, or face a Darwinian bloodletting where the most dominant and relevant will be the last ones standing.

Despite all of this, construction unions have enormous potential value for our industry. They actually have a sound business model that provides significant value. As a developer of the skilled labor commodity, they are excellent. As a business partner, they can bring key resources to the market. The Construction Users Roundtable (CURT) current Tri-Partite Initiatives indicate that the largest and most influential U.S. owners and end-users recognize this potential.

The failure of unions has not been one of relevance or value, but to plan, act and execute as business professionals. They simply did not understand or respond to their client’s needs. In my view, those days are nearly over.

The leadership in most of the key building trade unions is driven by a new proactive vision. Specifically, the general presidents of the carpenters, ironworkers, laborers and electrical workers, as well as the new leaders of the operating engineers and plumbers, are known as pragmatic, sophisticated businessmen committed to change. There no longer is any room for pretenders in these roles. Rhetoric won’t pay the bills anymore.

Unions are at a crossroads and leaning hard in the right direction. Now, with the right map and leadership to guide them, they may soon arrive at our doors with something we really want to buy.

Mark Breslin is chief executive of the Engineering and Utility
Contractor Association, San Ramon, Calif. He can be
reached at (925) 829-1332 or mbreslin@euca.com.

Click here for opinions archives >>

If you have an idea for a column, please contact Viewpoint editor William J. Angelo.