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September 29, 2006

Labor seeks to ride the wave, help Dems take control of House

Cyclical auto industry, not business taxes, is state's millstone, study says

Expanding Sparrow Hospital goes west

Bigger and better health care…St. John Providence tops out

Three building trades unions beef up commitment to organizing

Unfortunately, OSHA pushes paper with new respirator standard

Madame President - Local 58's president breaks gender barrier

News Briefs


Labor seeks to ride the wave, help Dems take control of House

By Mark Gruenberg
PAI Staff Writer

WASHINGTON (PAI) - With the Nov. 7 general election fast approaching, there are two things you can say for certain about the 2006 campaign: Organized labor is pushing economic issues, and the U.S. House is up for grabs. And both are important to working men and

Faced with a GOP campaign that, once again, emphasizes social issues - including the supposed "threat" of immigrants - and national security, unionists and their allies are pointing out that workers and their families have fallen farther and farther behind economically in the six years of virtually total GOP control of the government.

The litany of woe includes flat or declining real wages and a record number - almost 47 million - of uninsured, as well as disappearing private pensions.

And unions also point out that unless pro-worker forces re-take control of at least one house of Congress, by ousting enough anti-worker lawmakers, there will be few checks on the anti-worker policies of GOP President George W. Bush and his backers.

Independent polls and analyses show 54 to 55 of the 435 seats in the House are in play, many in the industrial Midwest. Of those nationwide, 17 GOP-held seats are too close to call. Democrats need to gain 15 seats to take over the House. The GOP now leads 232-202.

Another 17 GOP-held seats "lean Republican," meaning the Republican is ahead but the
race could change complexion. And 21 Democratic-held seats "lean Democratic." There are no Democratic seats in the too-close-to-call category.

"There's a big anti-Republican wave building," said Mark Mellman, a Democratic pollster working for several House candidates, to the Christian Science Monitor. "But that wave will crash up against a very stable political structure, and nobody will know till Wednesday morning (the day after the election) which is more important - the size of the wave or the stability of the structure."

Analysts count six Senate races in play, but not in Michigan, where incumbent Democrat Debbie Stabenow has a comfortable lead over Republican challenger Mike Bouchard. Even an unlikely Democratic sweep of those six Senate seats would leave them in a 50-50 tie with Republicans.

Workers are active in all of those close races, and others as well. They include gubernatorial campaigns, plus minimum wage hike referendums in six states.

The Change to Win federation, which broke away from the AFL-CIO last year, de-emphasized politics in favor of organizing, but made an exception for the Michigan governor's race. They're working for Jennifer Granholm. "This election is about wages, health care and retirement security for all of Michigan working men and women," said Teamsters President James Hoffa, in pledging their support for Granholm.

Organized labor is spending about $40 million this year educate members and their allies and to raise the percentage of union and union-affiliated voters. Labor and its allies were one-fourth of the 2004 electorate. Two-thirds of them backed Democratic presidential nominee John Kerry. Labor wants to increase its share of the electorate by several percentage points, especially in swing states such as Michigan, Missouri, Minnesota and Ohio.

"We will play the largest role we've ever played in electing the candidates we've endorsed in many of the pivotal, competitive races for the House and Senate," AFL-CIO President John Sweeney said at a pre-Labor Day news conference detailing the federation's election year program.

Most, but not all of labor support is going to Democrats. Unions are neutral in the re-election race of Rep. Melissa Bean (D-Ill.). She beat a 36-year GOP incumbent in 2004, with union support, in a pro-GOP district. Bean then became one of the "CAFTA 15" in 2005 - 15 Democrats who got the ire of unions for supporting the Central American Free Trade Agreement. Her present GOP foe says he would have voted against CAFTA.

Overall, however, "we're having a harder and harder time trying to find Republicans to support who support some of our issues. The Right Wing has taken over the leadership of the
Republican Party," said AFSCME President Gerald McEntee.


Cyclical auto industry, not business taxes, is state's millstone, study says

LANSING - There's no denying that Michigan's job situation is dire, with a 7.1 percent jobless rate that is leading the nation.

Job losses in our state - and why they're happening - is the single issue that will probably tip the outcome of the race for governor between incumbent Democrat Jennifer Granholm and Republican challenger Richard Devos. Tax policy is the other. Voters will have to sort through the rhetoric and decide for themselves the impact of Granholm's policies and their effect on losses, and whether Devos will be able to make Michigan more business-friendly and reduce the jobless numbers.

A new study takes some of the politics out of the equation. It said Michigan's tax rate isn't out of line with the rest of the nation. And the overwhelming controlling factor guiding the economic performance of Michigan is automobile sales - a situation which hasn't changed in a century.

The report, released last month, was produced by the nonpartisan, nonprofit W.E. Upjohn Institute for Employment Research and funded by the Michigan Economic Development Corp. It concluded that Michigan's economy has lagged behind the rest of the nation for the last six years almost entirely because of the decline in fortunes of the state's automakers.

"We have over seven times the national average of employment in the auto sector," said Timothy Bartik, a senior economist at the institute, told the Lansing State Journal. "If the auto industry had done better, we would have grown closer to the national average."

The report said, "each job lost in the Michigan motor vehicle industry causes a loss of more than four other jobs in other industries in the short run, and more than five other jobs in other industries in the long run. Many Michigan businesses are dependent on the spending either of the Big Three in purchasing supplies, or of the Big Three's workers in purchasing consumer goods and services."

The study probed a little deeper into the state's economic malaise - and found that after the auto-related problems, Michigan is fairly average. Turns out that the State's Single Business Tax (SBT) - a huge campaign issue and said to be a "job killer" by Devos - is benign when compared to other states.

In August, state Republicans voted to repeal the SBT at the end of 2007. The SBT accounts for about $1.9 billion of the state's budget. Granholm blasted that action, charging that Republicans did not have a plan to replace tax money, and said she would not support a plan that would place more of burden on Michigan taxpayers.

"Even though Michigan's business taxes are unlikely to be a major factor in explaining the state's recent slow growth," the Upjohn study said, "the question remains as to whether our taxes are out of line with those of the U.S. and our competitor states." Using three different tax scenarios, "the most recent measures of Michigan's taxes suggest that Michigan's taxes and business taxes are actually slightly below the U.S. average. Depending on the tax measure one uses, Michigan's taxes appear to be from 5 to 19 percent below the U.S. average."

That analysis relatively jibes with a report by Ernst & Young in conjunction with The Council on State Taxation in Washington, D.C., which ranked Michigan 26th nationally in state business tax competitiveness.

A year ago, the Michigan Prospect think-tank (which leans liberal) issued a paper called "Evaluating Michigan's Business Taxes." Author Robert Kleine pointed out that Michigan's business taxes have declined from 20.7 percent of the total state tax base in 1986 to 10.1 percent in 2004.

"Economists and tax experts," he said, "have debated for years the effects of state and local taxes on economic growth. The general conclusion is the taxes at the margin can make a difference but other factors such as quality of the work force, quality of the education system, labor costs, access to markets and natural resources, and quality of life are more important.
Michigan's current economic problems are due more to the problems of the American motor vehicle industry than to high business taxes."


Expanding Sparrow Hospital goes west

By Marty Mulcahy
Managing Editor

LANSING - More than 200 Hardhats are putting their skills to work building the Sparrow Health System West Wing Addition, the largest construction project at the facility in two decades.

The building trades and program/construction manager Granger are up to their elbows in construction activity at the hospital, and work is currently focusing on building the 450,000-square-foot, eleven-story addition. The trades are also erecting a new utility plant on Sparrow grounds, and performing various renovations in the existing hospital.

"We're right on schedule," said Jon Upton, project director for Granger. "There's a project labor agreement on this job, and that's been working well; it means we're getting the best of the best contractors and workers. And the craftsmanship has been excellent."

With some of the buildings on the Sparrow campus dating to the 1950s, architect HDR Inc/Neumann-Smith said the design concept for the hospital addition and parking structure "creates a unified contemporary appearance to the various architectural styles and materials of the existing buildings."

This 7-year, $150 million phase of construction at Sparrow began in 2003 with the erection of a 1,200-spot parking deck. That was followed by the creation of a new main entrance/lobby that eventually will connect the new parking deck to the old main entrance. The West Wing addition will house six operating rooms, with adjacent patient prep and recovery areas. First floor space will house a new Emergency Department which will include 75 treatment bays.

The third floor level of the West Wing addition will be a new 34-bed ICU/ CCU department and the forth floor will be a new Cardiology floor. The fifth and sixth floors will have new patient beds, and the floors above the sixth will be shelled out for further expansion.

Some completed patient rooms will be turned over to Sparrow at the end of 2007, and floors in the rest of the addition will be completed in phases throughout 2008.

A new central utility plant with related utility tunnels is also being built on the campus to accommodate the greater electrical demands of the new tower, as well as to replace aging equipment. The plant's new boilers will be dual-fueled, primarily by natural gas but also by diesel. Backup emergency generators will be able to provide power to the entire campus.

"This effort is Sparrow's most ambitious project in more than two decades and addresses significant healthcare needs prominent on our community's horizon," said Sparrow President Dennis Swan. "A successful future for Sparrow will ensure that all patients, today and for generations to come, can benefit from the latest medical techniques and technologies."

Upton said there are several factors which contribute to making this project a challenge. Operations at the hospital are ongoing, and limited lay-down/staging area is available. Working adjacent to an existing middle school adds to the safety challenges of the project along with working above the main entrance to the hospital.

Utility lines from the new Central Utility Plant to the hospital run under the school's parking lot. The city has torn up Michigan Avenue in front of the hospital. The hospital is as busy as ever, and tradespeople and hospital personnel do their best to stay out of each other's way.

"It's not like putting up a building in a field," Upton said. "There's a lot that has to be brought together and everything has to be done in phases. We have to coordinate with a lot of parties to make this work."

A PORTION of the $150 million expansion of Sparrow Hospital, as seen from Michigan Avenue in Lansing.

SETTING UP a box in a patient room in the West Wing Addition at Sparrow Health System is Erik Buckley of IBEW Local 665 and Summit Contractors.


Bigger and better health care…St. John Providence tops out

By Marty Mulcahy
Managing Editor

NOVI - The first new hospital to be constructed in southeast Michigan in the last 20 years was topped out Aug. 31 - creating the second construction milestone for St. John Providence Park Hospital after its January groundbreaking.

Iron Workers from Local 25 and Midwest Steel set the last beam into place, the last of 4,470 pieces of structural steel that went into the new hospital

"American Bridge, Midwest Steel and Site Development have all played a special part in making this milestone," said David Martin, of construction manager Barton-Malow - White Construction. "They and their workers are to be commended for meeting safety goals and making the project a success."

The 200-bed, $224 million hospital will be one of a handful of hospitals in the nation that allow "acuity-adaptable rooms," which allow patients to remain in one room throughout their hospital stay. The new hospital will also have an emergency department designed to function as a Level I Trauma Center, as well as alphabet soup imaging capabilities such as MRI, CT, PET and ultrasound. The facility will also have a dedicated pediatric unit, the Michigan Ear Institute, and a center for facial reconstruction surgery.

During short remarks at the job site, in front of hospital personnel and construction workers, hospital President Robert Casalou said he had a "rare opportunity to thank the guys at Local 25 who did this work. The most important thing is that this has been a safe project. Thanks to all the workers on the project for the skills and professionalism you have brought to this project. We want to make us proud of the hospital when you move on, for the great work you've done."

The six-story, 500,000-square-foot hospital will employ more than 1,500 when it opens in mid-2008.

The Providence Park project is one of numerous health care projects going on in Michigan. Whether its new construction or expansion, all are bringing in new ideas in health care.

For example, the entire third floor of the Providence Park hospital will be exclusively for women. And Casalou told a health executive publication that there will be no public paging from overhead speakers at the hospital, except in emergencies that involve the entire hospital. Hospital employees will be able to communicate to each other via headsets

A 10,000-square-foot "employee center" will be the gateway for all staff and doctors who work there. It will house the human resources and corporate health department and feature computer labs, lockers, and showers. Employees, he said will feel like they have a place in the facility away from the public eye, providing an "off-stage, on-stage" environment that the Walt Disney theme parks employ.

Midwest Steel's Mark Hall, the project's general foreman, and Andre Mondoux, the raising gang foreman, led the iron workers toward the topping out milestone. The project's yard gang foreman Dallas Campeau is retiring along with Hall. "This is my last job, I'm riding off into the sunset," Hall said. "The last job was a good one."

IRON WORKERS from Local 25 and Midwest Steel topped out the St. John Providence Park Hospital on Aug. 31.


Three building trades unions beef up commitment to organizing

WASHINGTON (PAI) - Delegates to three building trades international unions, having returned from their general conventions, committed to making dramatic changes in organizing funding and strategies.

The International Brotherhood of Electrical Workers, the Iron Workers and the Laborers all took significant steps in changing the way they will go about organizing. Following is a roundup:

International Brotherhood of Electrical Workers President Ed Hill, re-elected at the union's mid-September convention in Cleveland, says a new and innovative organizing drive in Florida will be a model for union-wide efforts.

But to accomplish it, and to reverse a membership decline of 63,730 since July 1, 2001, and to hire and train new organizers, Hill asked delegates to raise the union's per capita tax three times in the next five years.

"We all know dues increases can be painful, but think about the consequences of maintaining the status quo. Without investment in our programs, our growth will be stunted. Without growth, our ability to represent and protect our current members and their families is jeopardized," he explained.

To add the new members, the union "expanded its small works agreement" in Florida and will carry that on to central Pennsylvania, then elsewhere, Hill said. The small works agreement lets IBEW's cooperating contractors and union members "compete for residential and other work we have long been shut out of" by creation of "new construction wireman and construction electrician classifications." The agreement has brought the union's share of the huge and growing Florida residential electrical contracting market rose from below 10 percent to 14 percent in one year, Hill said.

Hill said the IBEW wants to hire and train 100 new international organizers and assign them to start new geographically based regional organizing councils. "The idea is not to supplant local organizing efforts," but "to provide the kind of genuine, solid support… missing from our strategy - support that will encourage rank and file participation, identify winnable targets-of which there are literally thousands, and go after them in a coherent, well planned manner," he explained.

Delegates to the 23rd General Convention of the Laborers' International Union of North America earlier this month voted to increase funding for organizing to $140 million within three to four years.

The monetary commitment to organizing is more than any other construction workers' union and more than virtually any other union in North America. "The increased funding," a statement by the union said, "would be married to organizing strategies regionally and nationally to help organize hundreds of thousands of non-union workers in the union's core sectors of building and heavy and highway construction."

The union said it has also committed to a comprehensive organizing effort in residential construction, where workers are usually woefully under-represented by unions.

"We must become so strong that any employer who basks in the culture of greed shudders at our name. We must become so well-known that every laborer in need calls out our name," Laborers General President Terence M. O'Sullivan told the 1,700 convention delegates as he opened the convention.

At their general convention on Aug. 16, the Iron Workers International Union voted to double the amount of dollars that union devotes to organizing. The union will now allocate $4 per member per month to organizing, up from $2, delegates decided.

And the resolution lets the union's board raise the amount further, between conventions.

"A union that is willing to accept the status quo is a union that is doomed to failure," Ironworkers President Joe Hunt said in his keynote address. "Hanging our hats on our past accomplishments" and sustaining present activities "are the choices of a union that is slowly dying," he warned. Hunt backed the hike.

The extra money will go to local organizing, to creating a national marketing campaign showing the benefits of unionized Ironworkers, and to establish a special national organizing team to help locals, said Hunt and Organizing Director Bernie Evers.


Unfortunately, OSHA pushes paper with new respirator standard

By Scott Schneider
Laborers Health
& Safety Fund

The question of how well a respirator protects has been a matter of controversy between users and manufacturers for many years.

More than 20 years ago, OSHA recognized the need to update its respirator standard and began the rulemaking process. Although a new standard was finally issued in 1998, OSHA put off setting new assigned protection factors (APFs) for various respirators because of disagreement over the levels at which they should be set.

Now, eight years later, the new APFs have finally been published and they go into effect in November. The big question is: are they protective enough?

Many construction workers have to wear respirators to protect themselves from chemical exposures during welding, torch cutting, painting, waterproofing or cutting concrete and masonry. The government began setting "protection factors" for respirators more than 40 years ago in regulations for the Bureau of Mines.

The most controversial part of the new APFs is the lack of any distinction between traditional rubber (elastomeric) masks with cartridge filters and new paper masks (filtering facepieces) that breathe through the entire mask surface.

Both are given an APF of 10. This decision was based primarily on data from the respirator manufacturers. Labor unions, including the Laborers International Union, and many other groups testified that filtering facepiece masks should only get an APF of 5 because they do not seal as well against the face to keep out contaminants.

A 5 would mean they only protect half as well. Yet, OSHA sided with the manufacturers who have been promoting the filtering facepiece masks which have become a larger share of their business.

Respirators are divided into various categories:

  • Air-purifying (the worker breathes normally through a filter).
  • Powered air-purifying (a motor pulls air through the filter and blows it into the mask).
  • Supplied Air or Airline respirators (air is pumped into the mask from a compressor).
  • Self-contained Breathing Apparatus (SCBA) (air comes from a bottle on the worker's back like that worn by firefighters or scuba divers).
  • The APF is based on the type of mask and the size. The three sizes are: quarter mask (which only covers the nose and mouth), half mask (which covers the lower half of the face) and full face mask (covering the whole face). The larger the mask, the more protection it offers. However, respirators that pump air into the mask can also come in a loose fitting variety. These do not offer as much protection.

    The APF is an estimate of how much protection a respirator provides. A protection factor of 10 means that no more than one-tenth of the contaminants to which the worker is exposed leak into the mask. An APF of 100 means only one percent leakage.

    The respirator supplied in various situations is based on the hazard faced (e.g. dust respirators for exposures to dusts and gas and vapor respirators for exposures to gases) and the expected level of exposure. The goal, according to OSHA, is to make sure exposure inside the mask does not get above the OSHA permissible exposure limits (PELs).

    The promulgation of new APFs will be useful, particularly in helping companies and workers select the right respirator for the job. However, the real issue will continue to be how well the respirator is used. This is a matter of where and when exposures occur, whether the respirator is in good working order, how it is cleaned and maintained and how well it is fitted when used. Every company must have a comprehensive respirator program.

    Schneider's seven deadly sins
    of Respirator Assigned Protection Factors (APFs)*

    1. APFs assume everyone will use the respirators perfectly every time. If not, protection will be less than promised.
    2. To protect correctly the concentration of chemicals outside the mask needs to be known. Normally, that is not the case in construction.
    3. APFs are designed to keep the concentration below the OSHA limits. These limits are mostly out-dated and not protective enough.
    4. APFs are designed to protect 95 percent of workers to the OSHA limits. About five percent (one in 20) will likely be overexposed, an unacceptably high number.
    5. APFs are based on protection from the average concentration over the entire workday. Construction workers often are exposed to very high peak levels which can be way over the APF for short periods of time.
    6. APFs are mostly based on studies in simulated work situations. These conditions are not that close to what workers experience on real jobsites every day.
    7. APFs are based on measuring contaminants inside the mask compared with outside the mask, not on what workers actually breathe into their lungs.

    *Based on testimony by Scott Schneider before the OSHA Expert Review Panel on Respirator APFs in June, 1994.



    Madame President - Local 58's president breaks gender barrier

    Construction is still very much a man's world, with women workers comprising less than three percent of the industry's workforce. There aren't any statistics on the percentage of building trades women who hold union office, but they are rare.

    One of those rarities is Elaine Crawford who was elected president of IBEW Local 58 on June 23. Winning the election with 1,393 votes to her opponent's 1,128, Crawford, who was appointed in July 2005, continues to hold her position.

    Crawford is the first woman president of IBEW Local 58 - one of the largest construction locals in the state - and is, quite possibly, the first elected or appointed woman president of any construction union in Michigan. (Feel free to correct us if we're wrong.)

    Although they are probably more common in the Electrical Workers than in other unions, women construction union presidents are unusual in the U.S. An informal review of IBEW inside local unions in North America finds seven women presidents, and four of them hail from Canada.

    Local 58 is a union of more than 6,000 members, and about 300 are women. Two other women also won election to local union office: Susan McCormick is the new Recording Secretary and Kathy Devlin won re-election to the local's Examining Board.

    Married with a daughter and granddaughter, Crawford is a long-time resident of the City of Detroit. Reflecting upon the recent election, Crawford, a 28-year member of Local 58, said, "I wasn't elected because they needed a woman officer. I was elected because the membership wants the job done."

    A progression of elected positions and appointments put Crawford into the local's presidency. She has served on the local's Examining Board, as a trustee on the SUB Fund and the Pension/Annuity Funds, and on the Executive Board.

    When former Local 58 Business Manager Jeff Radjewski accepted a position with the International Union in July 2005, Local 58's Executive Board voted to move Joe Abdoo from union president into the business manager's position, and they elected Crawford to become the local's president. Both Abdoo and Crawford won three-year terms of office in the June 23 election.

    In addition to chairing union meetings, the president is responsible for many things. "Much of my time is spent promoting member involvement," she said. Crawford's responsibilities include all local union committees and trust funds. She is a liaison to the Metro AFL-CIO, the Blue Cross-Blue Shield Advisory Committee, and other community groups. The business manager has also given her the responsibility to develop union education initiatives. She represents the local at various public functions when the business manager isn't available.

    Abdoo said that it was obvious to him, when he worked with Crawford during her years on the E-Board, that she is an independent thinker. "Elaine is intelligent, industrious, and always does her due diligence with issues that come before her," said Abdoo. "She has a lot of great ideas." He added, "She is a very progressive president, but she is certainly not a rubber-stamp president. We don't always agree, but we work through our disagreements."

    Crawford said she received a number of phone calls and cards from her union brothers and sisters after the local's election, "which meant a lot to me."

    Abdoo said in the weeks Crawford's election, her gender has become a non-issue among members and contractors. "I can't speak for the entire industry, but I can say that at Local 58 we have a great resource of women electricians who do their work, do it well, and make our local better. I think Elaine, in her position, personifies their progressive attitude."


    News Briefs

    Johnson to lead state pipe trades
    Mark Johnson, business manager of Plumbers and Pipe Fitters Local 370 in Flint, was elected President of the Michigan Pipe Trades Association at their quarterly meeting on Sept. 9 in Traverse City.

    Johnson will fill the remaining nine months in the term of Jim Davis, who has retired from that post and will retire later this year from his position as business manager of Plumbers and Pipe Fitters Local 333 in Lansing. Next June, the state pipe trades president position will be up for a two-year term.

    The Michigan Pipe Trades Association conducts quarterly meetings around the state for pipe trades union delegates. One of the association's primary functions is to advocate for state and local piping laws that will improve the industry. One item the association is currently lobbying for is to establish a state mechanical licensing requirement for pipe fitters.

    The Michigan Pipe Trades Association presidency is part-time, and Johnson will continue in his post as the business manager of Local 370, which he has held since 1998.

    "I'm looking forward to working for the association in this new capacity. It's a privilege and an honor to represent the Pipe Trade members in the State of Michigan," Johnson said.

    Nonunion wage hikes spurred by shortages
    Wages for nonunion U.S. building trades workers are projected to see a 4.3 percent hike this year, and could go as high as 5 percent by the end of the year.

    Driving the increases: manpower shortages in Gulf Coast states brought on by hurricane damage, according to PAS Inc., via the Construction Labor Report.

    For unionized construction workers in the U.S., collectively bargained wage/benefit increases are expected to dip from 3.9 percent last year to 3.7 percent this year, according to the Construction Labor Research Council.

    The biggest wage/benefit hike for organized construction workers in recent years was 4.3 percent in 2002. As of last year, unionized construction workers enjoyed a $343 per week pay advantage over their nonunion counterparts.

    Nonresidential work leads jump in U.S.
    The years-long boom for U.S. residential construction is decelerating, but the nonresidential construction sector is experiencing a nice jump. And overall construction is up a bit for the first eight months of 2006 compared to the same period a year ago.

    "Twin economic reports today show how much vigor private nonresidential construction has," said Ken Simonson, chief economist for The Associated General Contractors of America (AGC). He was referring to recent reports from the Sept. 1 the Bureau of Labor Statistics and from the Census Bureau.

    He continued, "for the first seven months of 2006 compared to the same period of 2005, private nonresidential spending has risen an impressive 16 percent and public construction 10 percent. Even residential construction is still four percent ahead of last year's total for the first seven months, although I don't expect the final residential total for the year to be up."

    The greatest surges among construction sectors include lodging, up 46 percent in 2006; multi-retail - up 38 percent; hospitals, up 27 percent, and manufacturing, up 24 percent.

    Simonson predicted a "sharply falling" market for single-family and condominium construction.

    Meanwhile, Reed Construction Data - one of a handful of companies that watch these things - reports that from January through August 2006, the value of construction starts rose 9.2 percent, compared to the same period in 2005. However, allowing for inflation of the cost of building materials, the real value only rose 2 percent.

    "The slowdown in residential starts has already begun to moderate project cost inflation in the balance of the construction market," Reed said, "especially for lumber, gypsum and plastic products. However, the slowdown will have only a marginal negative impact on the demand for non-residential space and structures.

    Similarly, the slowing of overall economic growth from 3.5% to 2.5%-plus is already moderating cost increases, especially for oil-based products and wages, but will
    not cause significant project cancellations."


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