Collective Bargaining Yields Lowest Increases in 25 Years

Construction-industry collective bargaining negotiations completed in 2010 resulted in an average first-year increase in wages and fringe benefits of only $0.80 or 1.7 percent, the lowest percent increase in 25 years, according to the Construction Labor Research Council’s (CLRC’s) annual report on settlements.  The last time the average dropped below 2 percent was in 1985. This reflects a continuation of a trend that began in 2009, when the average first-year increase of $1.23 or 2.8 percent was the lowest since 1996.  Also like 2009 settlements, almost half of the average total package increase ($0.38) negotiated in 2010 was designated for higher contributions to multiemployer pension funds. A quarter of negotiations settled in 2010 resulted in a wage-and-fringe freeze or reduction for the first year of the agreement. Freezes and reductions were least likely in the Middle Atlantic Region, which covers Delaware, Maryland, New Jersey, New York, Pennsylvania and the District of Columbia. Close to 60 percent of settlements reported to CLRC were for only a one-year duration.  This is also a continuation of a trend started in 2009 and is typical in tough economic times.  Prior to 2009, the negotiation of three-year contracts was most common.  Where multi-year agreements were executed in 2010, the average second-year increase negotiated was $1.16 or 2.1 percent, and the average third-year increase negotiated was $1.39 or 2.7 percent.  This compares to $1.55 or 3.2 percent for the second year, and $1.63 or 3.4 percent for the third year, in 2009.  Multi-year settlements were most common in the East North Central Region in 2010, which covers Illinois, Indiana, Michigan, Minnesota, Ohio, West Virginia, and Wisconsin. The complete report is posted along with other CLRC reports on the Labor & HR Topical Resources page of AGC’s website at www.agc.org/labor/topicalresources.  Select “Collective Bargaining” from the first pull-down menu and “Collective Bargaining Agreement Data” from the second for links to the reports.  For a searchable database of collectively bargained wage and fringe benefit rates, go to www.agc.org/cbrates. AGC is a founding member of CLRC and supports its efforts to gather and report useful and accurate labor-related information for contractors.  Collective bargaining AGC chapters are reminded to kindly send all settlements information to CLRC promptly upon completion.  Information may be submitted to CLRC by e-mail at clrc@clrc.biz, by fax to (202) 347-8442, or by mail to 1750 New York Ave., NW, Washington, DC  20006.