NECA TransmissionsNotes from the front lines of the electrical contracting industry
  • From The Mouths Of Children

    Posted on Dec 04, 2009 by John M Grau

    Discussing the implications of tax policy isn’t a conversation you’d normally have with an eight-year-old, but that’s just what I did with my son, Brendan, earlier this week.

    Mom was off for a “girls’ night out” and being the resourceful father that I am, I declared a “boys’ night out” at the same time. Brendan and I went to a spot where we could watch a football game while having dinner.

    He has been following some of the news about the financial crisis and the post-election events. He had some opinions he wanted to share. He seemed perplexed about the idea of politicians raising taxes.

    Brendan is a budding entrepreneur. He takes jobs in the neighborhood collecting mail, watering plants and feeding cats when people are away. He saves most of the money he earns but uses some of it to buy toys or games he wants.

    He told me that if taxes go up, he’s not going to take as many jobs. No use working more and sending a good chunk of it to the government, he reasoned. He also said he would cut back on some of his purchases of toys because he will have less money to spend. (He doesn’t pay taxes, so I don’t know where he picked up the idea that he does).

    Brendan’s behavior in anticipation of increased taxes is exactly what human nature tells us to do. When economists study dynamic (versus static) models of our economy, they find that people who have control over how they earn money (generally wealthier people) will cut back on what they earn when taxes are increased. So policies designed to “tax the rich” usually don’t produce the extra tax revenue that policymakers think it will.

    I guess I was just amazed how an eight-year-old was able to grasp and articulate this basic concept. Maybe politicians should consult with these emerging entrepreneurs.

    Later that evening, Brendan told me that he knows what moms talk about during “girls’ night out.” Anticipating more pearls of wisdom I asked him what. They talk about how much they love their husbands, he said.

    There are limits to what an eight-year-old understands.

     

  • Rising Above

    Posted on Nov 30, 2009 by John M Grau

    The week before Thanksgiving, I participated in the topping-off ceremony for the Beekman Tower in New York City. This Frank Gehry-designed apartment building will be the second tallest residential structure in North American and the tallest in NYC. But it came close to being much shorter.

    Earlier this year the developer, Forest City Ratner, decided to halt construction at the 40th floor. Due to economic conditions, developers all over the city were making decisions to curtail or cut back construction.

    That’s when New York City contractors and building trades unions went to work to save their jobs. Together, they forged an innovative project labor agreement that knocked anywhere from 15 to 25 per cent off their labor costs. NECA member, David Pinter of Zwicker Electric, was instrumental in the process. Zwicker is also the electrical contractor for Beekman Tower.

    As a result of the PLA, high-rise construction in New York was restarted, and Beekman Tower reached its planned 76-story height. The NEBF provided part of the financing for the $1 billion plus structure.

    NECA and IBEW officials at both the local and national level were on hand for the topping-off ceremony. Developer Bruce Ratner was profuse in his praise for the cooperation he received from the unions and contractors, and he cited NECA, IBEW, and NEBF in particular.

    The Beekman Tower is a very visible and tangible reminder of what labor-management cooperation can achieve.

    As a side note, my hotel in New York was located directly across the street from Ground Zero, the former World Trade Center site. I’ve been there a few times since 9/11 and it’s always a bit of a shock to see this vast empty space in the middle of Lower Manhattan.

    When I checked into the hotel, the front desk clerk warned me that construction was going on around the clock and there might be some noise. From my 40th story window, I looked right down on the 16-acre construction site. It was well lighted. In one corner, the steel for the Freedom Tower was already a few stories above grade, while nearby earth was still being moved to prepare the foundations for other buildings.

    I got up a couple times during the night to see what was going on. It wasn’t the noise that drew me to the window. In some ways, I felt that it was my solemn duty to watch the rebuilding process. Even in the middle of the night, recovery from one of the greatest disasters on American soil was taking place.

  • Line Construction -- A Firsthand View

    Posted on Nov 05, 2009 by John M Grau

    How many electrical contractors work on a construction site that’s 65 miles long? If you’re a line constructor, it’s no big deal.

    A couple weeks ago, I and several other staff from NECA's national office were invited to visit a line construction job site in Northern Virginia. We were hosted by NECA District 10 VP Bill Green and the L.E. Myers Company. The job was a 500kv transmission line being built for Dominion Virginia Power.

    The job had some unique aspects. It is being built on an existing right-of-way. The new line is being built next to an existing energized line. When the new line is finished, the old line will be dismantled. The right-of-way goes through a national park and a Civil War battlefield park and across a major interstate highway.

    We were told that it was a real challenge for the contractor to work in such tight quarters. Usually when I think of tight working conditions, I envision a small utility closet, not wide open fields or several-acre substations. But I soon learned that building towers on a narrow right-of-way next to an existing energized line is no piece of cake. In fact, my vision of hanging from a steel tower was soon dashed — when we were emphatically told not to touch anything. There’s this small matter of induction.

    Safety is a big issue with line workers. We saw first-hand the extraordinary measures that are taken to ensure safe work practices. As the power lines crackled above us, it was obvious that even a small mistake can result in serious injury or death. The employer spends a lot of time and money to make sure each worker is trained in safety procedures before they get to the job site.

    I was also struck by the investment in tools and equipment that the contractor had to make to work on a project like this. An electrician with a ladder and a pickup truck is a long way from becoming a transmission line constructor. The cost of one large crane is more than the annual revenues of many inside contractors.

    I’ve always had great respect for NECA’s District 10 members. It was good to get a chance to see first-hand the challenges of a line construction job and to gain an even deeper understanding of what it takes to be competitive in that market.

  • When will the jobs return?

    Posted on Oct 09, 2009 by John M Grau

    I came across some pretty sobering statistics recently regarding the US jobs market. While economists are claiming that the recession is over and we're on our way to recovery, I don't see how we can truly say the economy is back until people are working again. Consumer spending drives over two-thirds of our economy and, without jobs, people are going to be careful about their spending.

    So here are the stats.

    The U.S. has shed 7.2 million jobs since the recession began in 2007. (By the way, over a million of those jobs were in construction). In addition to recovering those 7.2 million jobs, we need 100,000 additional jobs per month to keep up with population growth. If job market growth returns to the rapid pace of the 1990s (which is twice the rate of the 2001-2007 period) we won’t get back to an unemployment rate in the 5% range until late 2017!!! And that assumes no recession between now and then.

    Right now, we have about 10% unemployment and many economists think that number may grow some more before it starts to fall sometime late next year. But it's not going to fall fast. HIS Global Insight forecasts unemployment at 8.1% in 2013 and 5.75% in 2019.

    The other big question is, where will the new jobs come from? Some jobs are permanently gone and some will be in fields that we can't even imagine today. A quarter of today's workers are in jobs that the Census Bureau didn't even list as occupations 25 years ago.

    Some people are banking on electricity in the future. The Wall Street Journal printed an article this week titled: "5 Technologies That Could Change Everything." Three of the five technologies involve electricity (solar energy, renewable energy storage, and advanced car batteries).

    With the nation’s emphasis on "green" jobs and renewable energy technology, student enrollment in power engineering programs is soaring. That's also a good sign for the electrical industry.

    While none of this guarantees growth for electrical contractors, it sure seems like we have a shot at being in the right business at the right time.

  • Good, Evil, and Electrical Contracting

    Posted on Oct 05, 2009 by John M Grau

    Are humans inherently good or evil? That is one of the classic debates in the history of philosophy and religion.

    The question came to mind as I watched the Labor Relations Special Session at the NECA Convention in Seattle. I was hearing and seeing examples of local labor-management committees in action. The underlying message was one of cooperation. The presenters talked about how they worked to break down barriers of mistrust to develop programs to promote and advance the electrical industry in their areas.

    I started to wonder why labor and management are so distrustful to begin with. And that lead me to the debate of good versus evil.

    In many ways, I think how we view human nature colors the way we see the labor-management relationship.

    Over the years, I’ve heard some electricians describe their employers as greedy, insensitive louts who take delight in mistreating their workers. There are also electricians who admire their employers and are grateful for the jobs and benefits they provide.

    I know electrical contractors who view union electricians as self-centered, lazy bums who barely work and will steal anything that’s not tied down. Then, there are contractors who value the labor of their employees and are grateful for their time, dedication, and loyalty.

    Most of us don’t have such clearly delineated views. But we have to admit that do have prejudices, whether borne out of experience or just our beliefs about human nature.

    In times of economic stress like we are experiencing now, these underlying beliefs magnify our reaction to events. When employers bargain for wage reductions in order to be competitive, the distrustful union member will see it as just another example of a greedy employer taking it out on the backs of labor. Other union members may be hurt that the employer they so trusted and depended on is not taking care of them in their time of need.

    Overcoming these deep-seated beliefs takes a lot of effort. The presenters at the NECA Convention talked about how long and hard they worked to build even a minimal level of trust. It wasn’t the result of one meeting, but many meetings, over many months or even years.

    While none of this solves the debate over whether we are inherently good or evil, we do know that it’s possible to forge a productive working relationship between management and labor, employers and employees. The alternative is to accept that human nature is what it is, that nothing will change. And, of course, for those who hold that belief, it won’t.

     

  • Random Thoughts and Impressions from the NECA Convention in Seattle

    Posted on Sep 18, 2009 by John M Grau

    The General Session speakers were perfect for the times. Howard Behar, former Starbucks president, talked about the importance of people to our businesses and how investment in people pays off in the long run. Erik Weihenmayer, the blind mountain climber, showed us how adversity really doesn’t have to be a permanent defeat but can be an advantage. With many NECA members are struggling through this economic downturn, the messages couldn’t be more pertinent or uplifting.

    Speaking of optimism, I was encouraged by how many NECA members are positive about the future. Most expect a tough year in 2010 but then look for a release of pent-up construction demand after that. 

    Anyone who lived in the Seattle area told us how unusually nice the weather was. I’ve been to Seattle maybe a dozen times in my life. Only one time have I experienced rain there. Do you think they tell those tales of perpetual clouds and drizzle because they don’t want us to catch on what a great area it is to live in? A little selfish, if you ask me.

    I heard a number of comments about how the Trade Show looked bigger and better. It was actually a bit smaller than last year, but it did feature a great variety of vendors — and NECA members kept them busy on all three days of the show.

    Many of the workshops and seminars were packed. While there’s a big social aspect to a convention, this shows that the real reason to be there is education.

    A truly random thought: Why are so many people interested in paying to ride to the top of the Space Needle? I assume when it was built in the 1960s it was the tallest structure in town. Now, there are a number of buildings from which you can get a great view. For example, the sights from the top of the Columbia Tower are spectacular. And you look down on the Space Needle!

    BTW: No need to comment to me about the Opening Reception. I know. If you’ve been to other NECA Conventions, you know that isn’t our norm. We’ll fix it.

    But, all in all, it was a great week.

     

  • Immigration Reform Moves a Bit Closer to the Front Burner

    Posted on Aug 28, 2009 by John M Grau

    On Tuesday, I received a call from The White House. I was asked if I would attend a meeting there on Thursday. Department of Homeland Security Secretary Janet Napolitano was hosting a roundtable discussion on the topic of comprehensive immigration reform. This is one of the issues that NECA follows, so I said yes.

    Immigration reform is one of the administration’s top issues, but it has been on the back burner while Congress deals with other major legislation — which at the moment is health care reform. Immigration is expected to be on the docket in 2010, so the meeting I attended was an effort both to get ready for the legislation and to start the selling process.

    At present, NECA has three main concerns regarding immigration — (1) vicarious liability under any employment verification system, (2) border security, and (3) the need to streamline the H-2 visa system for construction needs. I spoke to Secretary Napolitano and White House and DHS officials on the third point.

    I noted that the current H-2 visa system is too cumbersome, especially for employers with emergency manpower needs. As an example, I told about our line contractors’ need for linemen following Hurricane Katrina. Qualified, trained IBEW linemen were available in Canada, but the visa requirements made it nearly impossible for them to work in the United States — at least on a timely basis. I suggested that employers, or perhaps labor-management groups like NECA-IBEW, should be able to pre-qualify for worker entry visas. 

    Most other aspects of immigration reform were discussed during our two-and-one-half-hour meeting. It was encouraging to see the administration listen to our concerns. Of course, we don’t know if they will accept any of our suggestions or not.

    Near the end of the meeting, President Obama popped in to say hello and to thank us for participating. It was the first time I met the president in person. 

    NECA’s presence in, and influence on, national political and legislative matters continues to grow. This week’s White House meeting is just one more example of that.

     

  • A Conversation about Socialized Health Care and Socialized Congressmen

    Posted on Aug 06, 2009 by John M Grau

    I had an unexpected, but fairly lengthy conversation with Congressman John Dingell (D-MI) earlier this week. I was at the opening ceremony for our NJATC’s National Training Institute at the University of Michigan. Dingell, the longest-serving member in the history of the House of Representatives and a powerful House leader, was there to welcome our group to Michigan.

    I was backstage at Hill Auditorium, the site of the opening ceremony, when Dingell hobbled in on crutches. I said to him that it looked like he needed to get national health care passed sooner rather than later. He replied that members of Congress have good health care and that he was trying to get the same deal for the rest of the country. I reminded him his health care came through private insurance and not a government-run plan. He bristled a bit and told me public insurance would only be an option, not a requirement under the proposed legislation. He then went on the attack against insurance companies, whom he claims are the true villains in our health care system.

    I’m not a fan of the insurance companies, but I recognized that he was using the talking points that House members were given before they went on recess this week. Someone did some polling and found out that most Americans hate their insurance companies. So in selling a national plan, the Democrats are setting up insurance companies as all things evil. 

    I asked Dingell if they were going to include a tax on high-end health plans. I noted our industry’s concern that our long-established and collectively bargained plans may fall into the tax trap. He said he isn’t a big advocate for taxing benefits but he feels that rich people and company owners are taking advantage of the tax deductions and he isn’t against hitting them up for more money. 

    We went on to debate a few more points and didn’t agree on much. One thing we did concur on, however.

    Congressman Dingell said he felt that Congress doesn’t work as hard as it used to. He said they used to put in a full five-day week in Washington. I noted that now they feel obligated to get back to their districts every weekend to meet with constituents. That can be a good thing, but in the old days when they spent the weekends in Washington, they tended to socialize with each other. And, by socializing together, they learned to like each other better and to work cooperatively on solving problems.  

    I told the congressman that I’m probably one of the few people who would like to see congressman take even more of the so-called boondoogle trips they make around the world. As long as they travel with a member of the opposite party, I think we taxpayers should foot the bill for even more travel. Nothing helps you get to know another person like traveling together with him and his family.

    Dingell gave me a wink, said “amen,” and then hobbled out onto the stage in front of me.

  • Cooperative Programs and Partnerships No Longer Safe with OSHA

    Posted on Jul 17, 2009 by John M Grau

    OSHA is looking to go back to the old days and old ways. It’s time for employers to be concerned.

    Under the direction of the past administration, leaders at the Department of Labor and OSHA started down a new path by encouraging voluntary compliance programs and by working with employer groups to improve safety. The feeling was that the goal of the agency should be to improve safety, not just rack up citation statistics. Unfortunately, under the current administration, that view seems to be changing.

    Over the past few years, NECA and other employer associations have had some success in developing cooperative programs with OSHA. These programs would work toward identifying safety problems and then come up with industry-wide solutions to them. The most notable of these programs is the Electrical Transmission and Distribution Partnership. The members of this coalition have worked very hard to improve safety in the line construction industry. Part of the glue that has held this group together is OSHA’s participation.

    While these coalitions have not been thrown out the window, the rhetoric at the Department of Labor and in Congress has changed. We now hear how OSHA was too friendly with employers. We hear that the only way that employers will improve safety is through increased enforcement. And most disturbing of all are claims that employers, in their search of profits, are purposely putting employees in harms way.

    The attitude is that employers are inherently evil. They only respond to threats of punishment and have no real concern for their employees, or so we hear. This attitude reflects a very cynical view of business in general. It totally ignores the positive role that employers have in workplace safety, and it exonerates employee behavior and absolves them of responsibility for their own safety.

    Everyone can come up with examples of egregious behavior by an individual or company that led to worker injury and death. But to extrapolate this into wanton employer disregard for workplace safety is offensive.

    I know that NECA and its members will continue to do the right thing in improving safety in our industry. It’s too bad that some of our nation’s leaders can’t take enough time to get down from the grandstand to see how bottom-line results are really achieved.


    ** NECA has started a LinkenIn discussion group for electrical safety professionals. You will need a LinkedIn profile to join the group, NECA Safety. Contact aes@necanet.org if you have questions about using LinkedIn or joining the NECA Safety group.**

     
  • Health Care Reform: Prognosis Undetermined

    Posted on Jun 12, 2009 by John M Grau

    I can't decide how I feel about health care reform. It's now near the top of the legislative agenda and lots of proposals and ideas are being floated by the House and Senate committees working on a bill.

    Almost every American has a stake in the outcome. The health care industry is a huge segment of our economy. We all use health care services and most of us are covered by some type of insurance. We almost all agree that there's something wrong with our current system. But we’re also afraid to change it.

    Both sides of the reform debate seem to agree that there should be some form of mandatory coverage. Under our current system, those who have insurance end up paying more for coverage to subsidize services for those who don't. If everyone were required to have health care insurance, the overall cost should even out and insurers should be able to guarantee coverage even for people with pre-existing conditions.

    The idea of allowing individuals to select coverage from a number of competitive plans also appeals to me. I understand how the concept of employer-provided health insurance got started, but is it really the best way? Why should the employer be responsible for health care, and why should an individual be restricted to the type of coverage provided by his or her employer?

    Every individual has different health insurance needs - just like we do for auto or life insurance. If we had guaranteed access to coverage, we could pick the type of coverage that best suits our individual or family needs.

    Now comes the harder decisions.

    Should there be a public option among the competing insurance plans? In other words, should the federal government offer an alternative to private insurance? Would the government plan eventually force the private plans out of business so that we would be left with only government-controlled health insurance?

    An even bigger question is how do we pay for all this? Some ideas include taxing the individual for coverage beyond a certain amount and/or limiting the deductibility of insurance premiums paid by the employer. I know the unions aren't too happy about this idea, since most unions plans offer top-tier coverage. From an employer's point of view, wouldn't that create some incentive to control the cost of health coverage in our labor agreements?

    I like the fact that the United States has the best and most innovative health care system. I like the fact that we have free access to the doctors and hospitals of our choosing and that we don't have to wait months for elective care. I hate the bureaucratic morass of insurance claims statements, bloated costs, unnecessary tests, waste and fraud.

    So what do I want from health care reform? Something better, but exactly what, I can't tell you.

About NECA Transmissions

NECA Transmissions is a collaborative effort from CEO John Grau and NECA staff to provide insight and feedback on key issues from the front lines of the electrical contracting industry.

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