(TEXT OF THE SPEECH DELIVERED DECEMBER 9, 2009 BY BCTD PRESIDENT MARK AYERS TO THE 2009 WINTER MEETING OF THE ASSOCIATION OF UNION CONTRACTORS)

Thank you for that warm welcome.  I really appreciate it.

It’s always nice to be welcomed by, and to be among, friends.

And what better friends do America’s Building Trades Unions have than our contractor partners.

In preparing for this meeting, my staff told me that one of the things that was expected of me was to provide an update on the current status of the Building Trades.

Well, you all know this better than me, it’s bad out there!  Many of you are hurting…and many of our members are hurting.  Unemployment in our industry is now approaching 20% nationwide.  Some of our unions are reporting a ten percent reduction in their membership numbers.  It’s probably the most difficult situation I can remember in my lifetime.

But, in response to these troubling times, I can tell you that the Building and Construction Trades Department is singularly focused on doing all that it can to secure work for our contractors which will put our people back to work.

The picture is not pretty right now.  And it is especially painful at this time of year…when we gather with family and friends to celebrate the Holiday season…knowing that hundreds of thousands of good, honest, hard-working American craftsmen and women are struggling to tell their children that Christmas may not be a reality for them this year.

That disturbs me terribly.

That is the image that I have in my head from the moment I awake until the moment I fall to sleep.

And yet, in spite of this extreme detraction, and in spite of the current economic situation that we are enduring, I have a passionate optimism for the future.

It’s not just because I believe we have begun to turn the corner on this recession.

It’s true that home sales in October were at their highest levels in two and a half years.  And that capital spending and investments are starting to creep back up.

All of that is, indeed, good.

But my optimism is rooted in a long-term view of the world in which we live and work.  Because I see good things happening on both the supply and demand side of the equation that both defines the union construction industry and dictates the level of shared success that we are able to achieve.

On the demand side, my optimism can be summed up in three words…CLEAN.  ENERGY.  ECONOMY.

And on the supply side, the optimism is reflected in five words…VALUE.  ON.  DISPLAY.  EVERY.  DAY.

Let’s talk first about the clean energy economy.

Despite a lack of any coordinated or sustained policy attention and investment, the emerging clean energy economy has grown considerably.  According to the Pew Charitable Trust, between 1998 and 2007, the growth of clean energy jobs grew at a faster pace than jobs in general.  And despite the severity of the current economic downturn, investments in clean energy technology have fared far better than venture capital overall.

Whether we are talking about the solar, wind, nuclear, geothermal, hydro, or other forms of renewable energy, the growth potential is tremendous.  And that does not even include the prospect of achieving greater energy efficiencies through existing institutional and commercial building retro-fits.

Overall, the increased attention and financial support from Congress, state legislatures and private industry indicate that an American clean energy economy is poised to expand significantly.  Venture capital investment in clean energy innovations and technology totaled $12.6 billion in the last three years.

What that means is this:

Now, more than ever, the clean energy economy represents the greatest opportunity for the union construction industry in our lifetimes.  And America’s Building Trades Unions are putting their combined attention, resources and influence into securing these opportunities for our contractors and our members.

The American Recovery and Reinvestment Act of 2009 included an array of provisions to spur clean energy generation and energy efficient businesses, jobs and investments.  Included are almost $21 billion in tax incentives for wind, solar and other renewable energy manufacturers.  There is also a down payment of $11 billion to modernize our nation’s electrical grid and $5 billion for the weatherization of low-income homes.

At the same time, the Building Trades are working with the nuclear industry to push for federal loan guarantees for the construction of the next generation of nuclear power plants.  I’m particularly proud of the work that the building trades has done to place nuclear back on the radar screen.

Without our efforts, we would not be talking about nuclear today.  And, in fact, with a little more luck our efforts will produce the construction of the first nuclear power plant in the U.S. in over 20 years at nearby Calvert Cliffs in Southern Maryland.

And we have made it clear to the utility industry that we are able, ready and willing to partner with them in cooperative fashion, as evidenced by the development by the Building Trades Department of a 21st century Nuclear Construction labor agreement that is totally innovative in its scope and the specific provisions contained within.

We cold not have done this without the 13 Presidents who were willing to step outside the box with Sean McGarvey and I to create a game changing agreement for the low density areas.

We have also launched this year, in partnership with the American Petroleum Institute, an Oil and Natural Gas Labor/Management Committee.

This committee is designed, in large part, to re-introduce the union construction industry to the oil and natural gas industry.  Over the years, as you all know, our unions and our contractors lost a significant amount of market share in the petroleum industry.

And we believe that it is high-time that the industry sees us for who we are today…not what we were thirty years ago.  Recently, we convened a field trip of sorts for this committee.  Several executives from major oil and gas corporations…along with Jack Gerard, the CEO of the American Petroleum Institute…traveled to the greater Chicago area to familiarize themselves with the 21st century story of our unions and our industry.

They saw firsthand what we are about today.  And believe me, they were taken aback by what they saw and heard.

First, they visited the state-of-the-art apprenticeship training facilities of UA Local 597 and IBEW 134.  They now have a better understanding of the degree to which we go to invest in the training and education of the skilled workforce of tomorrow.

Secondly, they were given a presentation on national project labor agreements by me and the success of local project labor agreements by Tom Villanova of the Chicago Building Trades.  Tom presented to them in compelling fashion the jobsite efficiencies and competitive advantages that are built into the project labor agreements of today – not to mention the public relations and brand image enhancements that the industry could realize when they structure and utilize a project labor agreement that builds pathways to career training opportunities for local residents and/or disadvantaged communities.

It was, indeed, an eye-opener for these industry representatives.

And it is indicative of the need for America’s Building Trades Unions to put more effort into telling our story to everyone and anyone who will listen.  Especially the leaders associated with the existing energy and emerging clean energy industries.

You’re going to hear from Jack Gerard a little later in your program and let me say this about Jack.  Our union contractors and union building trades workers couldn’t have a more vocal and loyal advocate than Jack.  It has been my privilege to know him and work with him on our labor-management initiative, and I’m sure you’re going to enjoy his presentation.

Let me give you another brief example of where our new story is taking hold.

As you all know, Congress has been deliberating for well over a year now on climate change legislation.  The House of Representatives passed its version of a bill earlier this year…and the Senate is in the middle of deliberating the issue as we speak.

When the House bill began to move, we were confronted by an unexpected hurdle.  Members of the congressional Black, Asian, and Hispanic Caucuses…known as the tri-caucus…let it be known that they were uncomfortable with having federal stimulus money, as well as federal clean energy investments be directed to what they called, “business as usual” in the construction industry.

The between-the-lines interpretation is that these members of Congress were concerned about stimulus money being used to benefit “those white union guys in the building trades.”  Again, they were not aware of today’s story of our industry and our unions and how we are working to create opportunities in many minority and disadvantaged communities.

Now, I am not claiming that we are perfect when it comes to diversity and inclusion.  There is more work that needs to be done.  And I told these members of Congress that.  They were grateful to hear it.

As a result, we have since worked with the tri-Caucus in successfully getting language included in the House climate change bill that would ensure Davis Bacon coverage for any clean energy projects that receive federal dollars. 

Additionally, we secured the inclusion in the House bill of a “Green Construction Jobs Demonstration Projects” provision.  This section of the bill was specifically designed to ensure that federal investments in the clean energy economy would embrace a “high road” approach to construction.  Under this provision, the Secretary of Labor, in consultation with the Secretary of Energy will have the discretion to utilize project labor agreements for any construction funded through this legislation.

In a similar vein, let me also mention how very proud we are of our Native Construction Career Institute and our Cooperative Agreement initiatives.  This program is designed to offer work opportunities for tribal members, union contractors and Building Trades workers in Indian Country.  Over $400 billion of construction work will be performed on or near Indian lands in the next few years, and we hope to work with the tribes and federal agencies to secure tribal labor agreements or project labor agreements to secure that work.

You’ll hear more about these initiatives from Dr. Bob Middleton later in your program.

Folks, what I want all of you here today to understand is this:  we are doing all that we can…with the White House, the Congress, and the federal agencies…to level the playing field and create opportunities everywhere we can for the union construction industry.

My time is limited, so let me now turn to the supply side of the equation.

There are a number of equally exciting things occurring within our unions that are having a dramatic impact on our industry.  If you have been paying close attention to what is happening with America’s Building Trades Unions today, you will note that we have collectively embarked upon a new journey.

And it is a journey with a specific objective in mind:

To fundamentally re-define, re-position and re-vitalize the union construction industry brand.

To put it simply, we are evolving into a new organization, with a new culture.  And it is a culture that is being designed specifically to meet the challenges of our time.  Most notably, the emerging productivity and skilled manpower needs of an increasingly cost-conscious community of owners, contractors, and government agencies all across North America.

We recognize that in today’s world, it is very dangerous not to evolve.  Being flexible and attuned to the ever-changing needs of a market or an industry is an absolute necessity for achieving success in today’s world.

And today, our unions are making a commitment to become more customer-focused, and more value-oriented.

I hope you are experiencing a difference because we know our two year effort is being validated across the country in many areas.

Two cases in point are Chicago and New York City.  I point these two out specifically because I know they conjure up visions of inflexibility and old school practices.

But the reality today is quite different than what you have come to expect in these markets.  Because today, Chicago and New York are now models of success spurred by union leaders making common sense “business” decisions.

The new brand mantra for America’s Building Trades Unions sums it up quite nicely:  “Value on Display.  Every Day.”

At first this was just another catchy marketing slogan but now those five words represent a revolution.  They represent a sea-change in thinking within our unions.  And we are driving that message home to all of our local building trades councils and local unions so that they internalize it and make it the barometer for every decision and action that they take.

Because all of us in the trades must embrace, and we are embracing, a new reality; one that suggests that we FINALLY recognize and understand the core fact that we offer a premium product for a premium price.  And that premium product just happens to be the world’s safest, most highly skilled and productive craft workforce in the world.

But, just like any premium product or service on the market today, our success (which is measured by the level of market share for our product) will be dictated solely by the level of VALUE that our customers believe they receive in exchange for the investment they have placed in us.

Therefore, value has become the central theme in the re-positioning of the Building Trades brand.  It drives everything we do.

Our mission is to showcase and expand the union construction advantage.  And that advantage is centered upon the fact that we produce, through our apprenticeship and training programs, the most highly skilled and productive workforce known to man.

That is what makes us a VALUE-ADDED entity in the eyes of owners, contractors, governmental agencies, and community leaders.

If we stop for a moment and examine the changes that are happening in our industry today, it is very easy to see why our apprenticeship and training programs are so very critical for our strategic objectives.  Because as I speak to owners or contractors all over the nation, they all seem to be worried about one simple question once the economy begins to turn around:

Can we get enough skilled crafts people to man their jobs?

And governmental agencies and community leaders are searching for ways to leverage their construction investments in order to achieve certain societal objectives relating to workforce and career development.

It’s kind of like a perfect storm for the re-emergence of the union construction industry.

And think about this for a moment: 

As you all know, we continue to experience tight credit markets today.  These tight markets, as well as a host of other macro-economic factors are forcing owners and project managers to be as focused on bottom-line productivity like never before.

Therefore, and I know I am preaching to the choir here, they are not only concerned about the supply of skilled manpower, but they are also very, very concerned about the quality of the work that is produced by that manpower.  They worry about whether the skilled crafts people on their jobs are sufficiently trained in the latest technologies…the latest installation processes…and the most current safety procedures.

And just as importantly, they want to be certain that we offer a value proposition – not a proposition composed of headaches and grief!

All of this has tremendous implications for their bottom-line concerns.  That is where our competitive advantage truly comes into play.

Folks, I just want you to know that the General Presidents of all 13 of our affiliated unions, along with Sean and I, are doing all that we can to take advantage of this current economic downturn to help re-structure and re-position America’s Building Trades Unions for future sustained growth.

We are singularly focused on taking effective and full advantage of the opportunities coming our way.  We know that once the U.S. economy gets back on track, there will be tremendous skilled manpower needs across this nation in a host of industries.

And that will especially be true in the areas of institutional and heavy, commercial and industrial construction.  In fact, once the economy starts to rebound, there are estimates that the pace of construction in the next quarter century will eclipse anything seen in previous generations.

In fact, the Brookings Institution has estimated that nearly half of the structures that will be in existence in America in 2030 have not even been built yet.

We also know that today the average age of a skilled construction craft professional is somewhere around 47 years of age, while the average age of a skilled maintenance professional is in the neighborhood of 53 years.

Projections are that by 2014 the United States will be in need of one million additional skilled craft workers in the building and maintenance industries.  And with the investments being made by the Obama Administration and the US Congress in infrastructure and a clean energy future, these projections will probably be revised upward.

America’s Building Trades Unions are cognizant of all of these factors and we are taking steps to address them.

First, we intend to maintain and protect the stringent standards associated with our training programs and to aggressively recruit the next generation of skilled craft workers.

But, we are also looking at ways to streamline and accelerate the process by which apprentices move to journeymen status without compromising our standards.

Secondly, we are working feverishly…and I believe to great effect…to instill a new, value-oriented mindset into our network of local building trades leaders in order to convince them that the strategies and attitudes of yesteryear are of no use today.

We are forcefully making the case with our local leaders that our focus must be on demonstrating value to our customers.  Not once in a while…but consistently.

Value on Display.  Every Day.  It’s a way of life for us now.

And there are strategic advantages for us in launching this initiative now.  Because at the same time we are taking forward steps to re-position the union construction industry brand, we are simultaneously working to pull the veil off of our competition’s brand.

There is an old saying about reaping what you sow…and it applies to our industry today.

Now, I am not going to stand here and engage in the demonization of the open shop sector because, frankly, the “us vs. them” rhetoric that we hear so much today in politics and elsewhere just doesn’t serve much of a purpose anymore.  In fact, I will go even further and say that the best way for us to beat the open shop

is to stop competing with the open shop.

You heard me right.

The best way for us to beat the open shop…is to stop trying to compete with the open shop.

Our business model is entirely different from theirs.

Because of all that we have been through as a nation over the last two years, the United States is in the midst of a national culture change.  And it is one that is moving us towards the embrace of a more responsible form of capitalism.

This cultural evolution suits OUR business model…not the open shop’s.

I firmly believe that our success will ultimately boil down to three simple truths:

Developing friendship; developing loyalty; and developing a belief in one another.  Because for America’s Building Trades Unions, personal relationships form the backbone of our success.  It is incumbent upon us to cultivate friendships with the contractors we work with, the customers we work for (and those that we want to work for), if we want to re-capture significant market share for the union construction industry brand.

Likewise, if we cannot, through our performance, attitudes and actions, inspire a high level of loyalty among the members we represent and the customers for whom we serve, then we are doomed to a future of irrelevancy and eventual non-existence.

That is why we are re-defining ourselves…and re-defining our strategic approach for taking back market share.

That is why we are elevating a new business model that people want to be associated with.

And that is why we are striving to create a newly energized and robust demand for the products and services that we have to offer…and the values that we represent.

Our desired end result is new, uncontested market space for the union construction industry.  We can do that by expanding the notion of what is important and what is possible in our industry…and in our society. 

That is the key to our success, and it is one I am confident we will accomplish with distinction.  There is no place in our industry for those that just can’t change.

In closing, let me just say how proud I am to represent the most trusted and effective skilled craft professionals in the world.  And I am equally proud to say that I consider the members of The Association of Union Contractors as valued friends.

None of us should be satisfied with what we have accomplished over the years.

To the contrary, our undivided attention and energies should be directed toward the potential to achieve great things in the very near future.

Because that future is in OUR hands.

Thank you, and God Bless you.