The Building Tradesman Current Issue | Back Issues Index

March 19, 2004

Granholm to building trades: Why are we subsidizing this kind of job loss?

"Jobs, jobs, jobs" Unemployment dilemma looms over 2004 election cycle

A better way to burn coal introduced to Erickson Station

Construction industry, say hello to your new trend: Outsourcing

Trades support CLEAR choice to fix electrical deregulation

News Briefs


Granholm to building trades: Why are we subsidizing this kind of job loss?

By Marty Mulcahy

LANSING - The pending closure of the Electrolux plant - which makes Frigidaire refrigerators in Greenville - is the latest poster child for job losses in Michigan. Our state has lost 185,000 manufacturing jobs since 1999 - the same number of hourly plant workers employed by Daimler-Chrysler and General Motors combined.

Nationwide, the manufacturing sector has lost 2.6 million jobs since President Bush took office in 2001, making those job losses one of the top issues in this year's race for the White House.

With that backdrop, Gov. Jennifer Granholm addressed the 46th Annual Michigan Building and Construction Trades Council Legislative Conference on March 2. Following is a selection of her remarks:

"The chief of the president's economic advisors said that outsourcing is good for America. He also said that hamburger flipping is the equivalent of manufacturing. Well I'm certain that those who have lost manufacturing jobs over the last few years in Michigan are happy to know that they have a bright future flipping burgers. It's outrageous what's going on.

"The notion of this president is that if you give tax cuts to wealthiest, there is supposed to be an investment in the creation of jobs. The problem is that the second half of that equation is not come to pass. They've done all of these tax cuts. While we have seen a recovery on Wall Street we have not seen a recovery on Main Street.

"I know a lot of people who have been deeply affected by job losses. I use the Electrolux plant in Greenville as an example. Greenville is a town of 8,000 people. Electrolux employed 2,700 of those who lived there. When a company that sizes pulls up its roots and moves to Mexico it's like a nuclear bomb going off in that town.

"There's not a single person in Greenville who will not be affected by Electrolux's decision to go to Mexico.

"Even though the UAW came in with $32 million a year in concessions and the state went to them and said we will give you zero taxes for 20 years, even though we offered them an entirely new plant, they said, well we can pay workers $1.57 with no benefits in Mexico. So we're going to pull out.

"This is serious business, this situation with NAFTA and the other trade agreements that are currently pending. If there are no wage and environmental standards, we are giving points to the other team. We are allowing other countries to suck our jobs away. Why are we subsidizing this kind of job loss?

"Our workers can be competitive but we just have to make sure the playing field is level. It is not level at the moment, and we have to have a president that understands that we have to level the playing field so that we are not assisting in the hemorrhaging of job losses.

"It is clear we need a new president. It is clear we need some more assistance in the legislature, for your benefit. I want to make it clear, that you have a great partner in me.

"Our workforce is clearly an important part of our economic development. Jobs, jobs, jobs is the drumbeat that we're going to sound this year. It is so important that we retain the jobs we have and that we grow jobs and diversify the economy. We are not going to throw in the towel to globalization.

"We are going to see what we can do about leveling that playing field so that we don't we have to put up with those job losses, which I have heard are on a fast track to Mexico, on a slow boat to China or on the Internet to India. We're not going to allow that to happen. That's why we need new leadership at the top.

"Know that I am your ally, I am your sister, and I will make sure that the interests of you and your members are protected now and well into the future."

MICHIGAN GOV. Jennifer Granholm addresses Michigan Building and Construction Trades Council delegates.


"Jobs, jobs, jobs" Unemployment dilemma looms over 2004 election cycle

By Marty Mulcahy

Michigan's statewide unemployment rate improved a full percentage point to 6.6 percent from January to December. But it is still well above the national jobless rate of 5.6 percent, placing our state among the highest in terms of unemployment rates in the nation.

Even with the lower jobless figures, there are still about 336,000 unemployed workers in Michigan - roughly the same as a year ago, but today, there are 14,000 fewer job positions available.

The loss of good-paying U.S. jobs is at the center of this year's election debates. And there are numerous seats up for office during this election cycle, including the U.S. presidency, all members of Congress, all state representatives, two state board of education seats, regent positions at Michigan's major universities, two state supreme court justices seats, as well as appellate, circuit, district and probate judge seats.

Speakers at the Michigan Building and Construction Trades Council offered a few comments on what voters can expect this year. Following is a sampling:

Michigan Building Trades Council Secretary-Treasurer Tom Boensch - "We've heard a lot about dire straits in the manufacturing industry, a lot of workers' jobs don't exist any more.

"But our industry has suffered greatly, too. The average unemployment in Michigan in our industry is about 15 percent, and is upwards of 30 percent. There is 60 percent unemployment in one area. And there's not a lot of short-term hope or reason that we will be able to clear our benches any time soon.

"We need to get the wheels of industry turning again. We need to talk about jobs here as we lobby in Lansing and in Washington D.C.

"As we prepare for a new election cycle, the stakes couldn't be any higher.

"The president is trying to put a bright face on the economy, but he has lost more jobs than he has created. I believe President Bush about one thing - he and Vice President Cheney are taking care of business, but they are taking care of big business.

"President Bush pledged to help each and every one of us who wants to work, to help find us a job, but his job is getting bigger every day. This is a president who cannot run from his record; he has to run away from it."

State Rep. Julie Dennis (D-Muskegon) - "My suggestion to you is to keep your eye on the ball. Don't let the other stuff keep you from seeing what's really going on.
I wish President Bush would be as disturbed about losing three million jobs as he is about gay marriage."

State Supreme Court Justice Marilyn Kelly - "Today the majority of the Michigan Supreme Court sees the world through the eyes of the employer. They see the world differently. They're John Engler appointees."

Kelly told delegates about a case where the five majority conservative members of the state's high court have ruled that a worker who injured his back on the job could not collect workers compensation benefits. The reason: the worker had a pre-existing back injury that healed, which disqualified him for any new benefits.

"Your members need to know the differences between the justices and how their rulings affect the rights of working men and women," she said.

Dianne Byrum (Michigan Democratic House Leader) - "What you see out of the Bush Administration right now is a campaign to distract voters from the real issues. And the real issues for voters are: how am I going to get a good job? How am I going to provide health care for my family? How is grandma going to afford her prescription drugs?

"He wants to talk about defining marriage. He should be talking about why we are extending NAFTA, and why are we not extending jobless benefits?"

Gene DeRossett, (R-52nd House District) - DeRossett is a moderate Republican who has been helpful to building trades unions on several occasions. A few years ago, his decision to stand up and support the Michigan Prevailing Wage act influenced and won over a handful of other moderate Republicans. Their decision to stand up for prevailing wage saved the law from other Republicans who wanted the law thrown out.

"It was the best-worst day of my political career," DeRossett told delegates. "Because I had prevented something from happening that I believed in. I did take a lot of abuse for that vote, but when you stand up for what's right, it's worth it." DeRossett has also voted to turn down a waiting week for unemployment benefits.

As punishment, DeRossett said his district was realigned by the Republican Party to have a 73.4 percent new voter base - but he still won re-election handily.

DeRossett who is term-limited in the state House, is running for Congress in the 7th District, which includes Eaton, Calhoun, Branch, Jackson, Hillsdale, Lenawee and part of Washtenaw counties. His candidacy is endorsed by the building trades.

"I can tell you that I will not become part of the Beltway mentality and I will deal with the issues that affect families, that affect jobs, that protects your constitutional rights," he said.

David Hollister, director, Department of Labor and Economic Growth - Hollister told delegates that the state government has been reorganized under the Granholm Administration and is 20 percent smaller than it was two years ago.

Hollister said the governor directed him to develop a "Grow Michigan Strategy" and the Michigan Building Trades are helping to develop a workforce component of the strategy. Part of that includes helping direct future apprentices into available apprenticeship slots.

Major components of Granholm's plan, Hollister said, include investing in "human capital" (training workers), encouraging entrepreneurs, and an initiative to create a "single-entry, single-exit" for building projects in Michigan. Hollister said plans call for a system that will allow "one-stop shopping" for building, from getting permits to certificates of occupation.

He said the state is focusing on increasing construction related to residential building in core urban centers and launching a technology corridor to grow businesses like life sciences, alternative energy and homeland security.

"We want to know how to grow these businesses and how to encourage them and how to capitalize them," Hollister said. "This can only be accomplished through partnerships, and we consider our partnership with labor a critical part of this. We're focusing on growing this state and there is no better partner in growing this state than organized labor."

Michigan First Husband Dan Mulhern, (Co-chair of the state Kerry for President Committee) - "More than any president we've ever seen, Bush is a wolf in sheep's clothing. This president, a so-called compassionate conservative, has been incredibly deceptive. His economic policies have been deceptive, his tax cuts were unbelievably slanted towards the wealthy in America, and on foreign policy, he has really taken us for a terrible, terrible ride.

"The country ought to be outraged, but there is a bit of a Teflon quality about Bush. It is really time for a change. We have economic policy makers telling us that flipping hamburgers is the same as a manufacturing job. This wasn't some lackey, this was the president's chairman of economic advisers saying that outsourcing is a good thing. There is a density in Washington that is unbelievable.

"We have to motivate people and let them know that John Kerry has a 90 percent pro-labor voting record, that he supports organizing efforts, he's in favor of raising the minimum wage, that he's in favor of rolling back tax increases for the rich, that he is behind health care reform. People need to know that, people need to know that there's a substantial difference between the president and John Kerry."

Mark Gaffney, president, Michigan AFL-CIO - "In the last election cycle, Gore vs. Bush, we had 400,000 more union members than we have today. Every year (the AFL-CIO) lose a half a percentage point or so. We have to make those numbers up somewhere. So one place we've gone to is our constituent groups, Hispanic groups, African Americans, the Coalition of Labor Union Women, and ask them to find the swing voters in their communities to come our way. In order for that to work, some of your members will have to be part of those constituent groups. You will be hearing more about that.

"The question in this election is who's running America? Will it be working families? Or will it be wealth and power.

"The Bush agenda is clear, it's all business, and his agenda is clear, it's protecting the wealthy. Our members got a tax break of about $365 last year, the wealthy got tens of thousands in each of the next 10 years. His other agenda is to attack workers. He has a department of labor that is actively teaching its employers how to avoid overtime pay.

"A court told him his plan was too extreme to make every single local union file additional paperwork and hire an accountant for the extra paperwork.

"His results are clear, worst job losses since the Depression, largest deficit ever, worst trade imbalance, $1.2 billion every day is the trade imbalance.

"It takes union households to overcome nonunion households, who will vote for George Bush. If we do our job and add 5 percent to our vote, that's more registered, more turning out and more voting, that's how John Kerry can beat George Bush."


A better way to burn coal introduced to Erickson Station

By Marty Mulcahy

One of the largest capital improvement projects at the Lansing Board of Water and Light's Erickson Station powerhouse in the last two decades is now taking place, and the building trades are all over it.

The Erickson plant has been shut down for the work since Feb. 1 and is scheduled to reopen on April 9. During that time, the trades are making modifications that will allow the Erickson plant to burn more environmentally friendly Western coal, which has a lower sulfur content. At the same time, modifications to the plant will allow it to maintain its generating capacity, despite the use of the cooler-burning coal.

"This is a unique project," said Lansing Board of Water and Light Principal Mechanical Engineer Dan Flynn. "To the best of our knowledge, no one in the U.S. or Canada is making modifications of this type to a plant of this size." Capable of producing 165 megawatts, the Erickson plant is relatively small, but it is the biggest power producer owned by the Board of Water and Light.

Other Michigan powerhouses we have visited in recent years have chosen to install expensive and complex selective catalytic reducers (SCRs) as part of federal mandates to reduce their Nitrous Oxide (NOx) emissions. This project will help the Erickson plant to meet federal emissions requirements by efficiently burning the lower-sulfur, lower polluting Powder River Basin (Wyoming) "sub-bituminous" coal rather than the Eastern bituminous coal it was design to burn.

Major contractors on the project include Jamar Construction, Northern Boiler, Superior Electric and Matsui Babcock. About 120 construction workers are toiling on the project during this outage.

During this project, a number of new fixtures are being installed, including: over-fire air ports, water cannons to clean the furnace walls, a new primary air heater system and associated duct work, and a new ash removal system. In addition, modifications will be made to the coal crusher area, and boiler heating surfaces will be converted.

The "over-fire" air that will be added to the coal-burning process will add more combustible air around the coal as it burns, which will help bring about fewer NOx emissions.

"There are some unique things about this job," said Tom Delaney, a Plumbers and Pipe Fitters Local 333 member and superintendent for Northern Boiler. "I think the trickiest part has been putting in the new division wall in the boiler. That's a retrofit you don't usually see." The division wall will help in the transfer of heat in the boiler.

Brought on line in 1973, the Erickson Station has a single generator and has been rated one of the most efficient plants of its size in the United States. The last major upgrade in the plan was in 1998, when a new pollution controlling precipitators and associated duct work were installed.

The plant serves the greater Lansing area.

Flynn said preparations and some work for this $25.7 million project began in 1999, and work "really got serious" in 2003. The plant's goal is to be in compliance with federally mandated lower NOx emissions by June of this year.

"The tradespeople have been super out here," Flynn said. "I've never had any major problems with the crafts in the 19 years that I've been here. We're working under a very hectic schedule and we've had some issues, but certainly none of them have been caused by the tradespeople."

GUIDING A GAS inlet duct at the Lansing Board of Water and Light's Erickson Station are Steven Fitzpatrick and Josh Klauss of Boilermakers 169.

THE ERICKSON STATION and its signature 475-foot-tall stack were completed in 1973. An ongoing outage at the plant will last through April 9.


Construction industry, say hello to your new trend: Outsourcing

Outsourcing jobs in the U.S. construction industry is now officially a trend.

The Wall Street Journal, which pays attention to these things, said so earlier this month. Under the headline, "Salt Lake City's new library shows U.S. construction jobs are also shifting abroad," the article explained how it is now feasible - and apparently cost-effective - to manufacture sections of the exterior of a building in Mexico and ship it across the border for re-assembly at U.S. job site.

The Journal article described how some 2,500 concrete panels were recently made in Mexico City, then shipped 2,350 miles north via 140 flatbed trucks to Salt Lake City.

"Pretecsa's (the Mexican manufacturer of the panels) low-cost labor made up for the higher shipping costs, and they came in the cheapest," library project manager Steve Crane told the Journal. Pretecsa underbid the competition by $1 million on the $2.5 million job. A U.S. labor force on that project would alone have cost $3 million, the Journal estimated.

Local construction workers did the assembly on the $65 million Salt Lake City library - but that's not always the case. "Using Mexican workers at the source is an obvious attraction," the Journal said, adding that 300 Mexican laborers were imported to pour concrete silos at a recent job in Idaho Falls.

"The economics of building offshore have to do mainly with the high cost of skilled labor in the U.S.," said the Journal, "where workers who pour concrete 'slip forms' rarely make less than $20 an hour…. Migrant work gangs comprised of green-card-holding Mexicans have become increasingly common on large construction sites, especially in right-to-work states where unions are weak."

Utah may be across the continent, but Pretesca also wants to expand it range of operations: the Journal said the company plans to bid on making concrete panels for a hospital in Dearborn.


Trades support CLEAR choice to fix electrical deregulation

Cable television. Telephone service. Now, electricity.

The federal and state governments have a lousy record when it comes to deregulating public utilities. Costs have increased, and service has certainly not improved. Now, major problems associated with electrical deregulation are coming home to roost in Michigan, with DTE Energy leading a statewide effort to change the way Michigan law governs electrical production and distribution.

A group called the CLEAR Coalition - CLEAR stands for Citizens for Long-Term Energy Affordability and Reliability - was formed, it said, because Michigan's electric deregulation law, Public Act 141 of 2000, "has failed to deliver and is leading Michigan down the path toward a California-like crisis, with the potential for blackouts, huge rate increases and bankrupt utilities."

Building trades unions are onboard with supporting the CLEAR Coalition. Nancy Moody a DTE Energy representative, spoke to delegates at the Michigan Building and Construction Trades Council's Legislative Conference on March 2.

"I think the building trades have become involved with CLEAR for the same reason we did," she said. "The current electric system in Michigan is threatened. It is threatening our jobs and the reliability of the electrical system. But we have an uphill battle in trying to amend PA 141."

CLEAR pointed out that the goals of Public Act 141 (A Republican-backed initiative) included:

  • Introducing electrical choice for all residents and businesses in Michigan by allowing people to choose their own electricity supplier.
  • Lower costs and more jobs.
  • Bringing affordable and reliable electric power from financially stable Michigan utilities.

Instead, Moody pointed out:

  • Unless something changes, when the law's rate freeze expires in 2006, Detroit Edison's residential rates could go up 30 percent.
  • Michigan utilities have about 3.7 million residential customers. After four years under PA 141, only about 60 of them (yes, 60), were being served by an "alternative energy supplier," according to the Michigan Public Service Commission. The vast majority of Michigan small businesses also have no choice.

CLEAR concludes that unless Michigan legislators fix PA 141, residential customers who were supposed to have choice and affordable rates will end up with just the opposite: no choice and significantly higher rates.

Moody said the current law allows alternative energy providers to "strip" business customers - and about 15,000 have been cherry picked from DTE Energy. As a result, DTE's earnings for 2003 have dropped 31 percent. If a business or residence is too small or too far out of the way to be profitably serviced by an electrical provider, they can be ignored by everyone except the established utilities.

Michigan's established utilities, Moody said, are unable to compete because they are caught unfairly between a regulated and a deregulated environment. Established utilities are still regulated, but the competing electrical providers are not. When it comes to maintaining infrastructure and servicing power plants - areas of tremendous interest to the building trades - unregulated companies have less revenue to upgrade power production facilities, and less incentive to stick around because the system allows them to seek greener pastures for customers, without maintaining service to customers they have.

"It's a political process of transferring wealth from one corporate stakeholder to another, you and I are not going to get any benefit out of it," said Tom Boensch, secretary-treasurer of the Michigan Building and Construction Trades Council, to delegates at the March 2 legislative convention. "Deregulation is bad for Michigan's utilities, and deregulation is bad for Michigan's construction industry."


News Briefs

Trades get to work at $800M GM plant
DELTA TWP. - Ground was officially broken by dignitaries March 9 on the construction of a new $800 million vehicle assembly plant that will be constructed by union trades workers.

The Lansing Delta Township Assembly Plant will be the second totally new vehicle assembly plant built by GM in the greater Lansing area. The first was the Lansing Grand River Assembly Plant, which began production in late 2000. In addition, a 500,000 square-foot contiguous metal center is already operational at the site. This facility provides most of the major sheet metal to Lansing Grand River and will support the new assembly plant.

"Our decision to build a whole new assembly plant is the result of developing a business case for an all-new product that has tremendous potential in North America," said Gerald L. Elson, GM vice president and general manager of vehicle operations. "An important element of the business case was the work and cooperation of our employees, the United Auto Workers, the State of Michigan, local governments, and the greater Lansing community. As we do business in the extremely competitive global marketplace, the product and the manufacturing process - combined with our people and the community working in a cooperative manner - are all essential to develop a business solution that makes sense for everyone."

The Lansing Delta Township Assembly Plant will consist of three buildings covering approximately 2.4 million square feet. Construction has already started on the paint shop and work will begin on the body shop and general assembly building later this year. Production at the plant is scheduled to begin in late 2006. Products for the new plant have not been announced.

Asbestos vote is on Senate agenda
U.S. Senate Majority Leader Bill Frist has pledged to bring a floor vote in late March or early April on legislation to create a multi-billion trust fund to compensate workers exposed to asbestos.

Debate continues on how to properly compensate victims of lung diseases - thousands of whom are construction workers - brought on by asbestos exposure. Senate Republicans have proposed a $105 billion trust fund that would come from manufacturers who have used asbestos in their products and insurance companies, but many Democrats claim that needs to be at least doubled. There is also debate over how to put together an asbestos trust fund and proposals to limit litigation from the system that have gone on for years.

Democrats and organized labor do not like the Republican bill to resolve the asbestosis dilemma - but the GOP is going ahead with the vote. "At some point, the talking must end," Frist said.

Long-term jobless numbers increase
WASHINGTON (PAI)--The nation's unemployment rate was 5.6 percent in February, and 8.17 million people are out of work, the Bureau of Labor Statistics reported this month.

The number of unemployed in January 2001--the last data gathered under President Clinton--was 5.956 million and the adjusted jobless rate that month was 4 percent. Since then, 2.214 million people have joined the ranks of the jobless.

That's not the whole story. "With the persistent job shortage, 392,000 people gave up looking for work in February, making the official unemployment rate a misleading indicator of joblessness," the Economic Policy Institute said.

And the number of long-term jobless--whose unemployment benefits have run out--is 22.1 percent of all unemployed workers. The GOP-run Congress has refused to extend jobless benefits, which expired December 31. For the first time, the number of jobless who have been out of work at least 4 months exceeded 40 percent of all unemployed.

Further, BLS said 10.3 percent of workers are jobless, discouraged workers or forced to toil involuntarily part-time when they really want full-time work.



The Building Tradesman Current Issue | Back Issues Index