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The Shocking Cost of Open-Shop Exploitation


The numbers don’t lie. Too many corrupt non-union contractors get rich at the expense of everyone else. 

The exploitative practices of some corrupt non-union contractors have a profound impact on all New Yorkers.


Construction Workers Suffer

Many people rely on the construction industry to provide a path to the middle class. But increasingly, that pathway is only available to unionized workers who are guaranteed a living wage, benefits, and a safe workplace. Too many non-union construction workers suffer exploitation by their bosses, like wage theft and unsafe job sites, that keep them stuck in an oppressive grind.


Unfortunately, an ever-shrinking portion of the construction industry in New York City remains unionized. With more people joining the ranks of the non-union sector, more people are suffering under the thumb of unscrupulous bosses.


Building Quality Suffers

The quality of non-unionized construction jobs is deteriorating, fast; alongside it, the quality of New York’s iconic skyline has also gone sideways. This is the shameful result of a decades-long race to the bottom, in which contracts are awarded based primarily on the “lowest bid.” Enabling this slide are too many politicians acquiescing to deep-pocketed, mega-developers, who have made a religion of slashing labor costs by any means possible.

This is the shameful result of a decades-long race to the bottom, in which contracts are awarded based primarily on the “lowest bid.”


The luxury high-rise at 161 Maiden Lane on the Manhattan seaport is being built by non-union contractors. The 58-story condo is leaning north. In one of several accidents at the site a crane smashed into the deck of the 34th floor (right) and dropped concrete to the street below. In another crane accident a man was knocked from the scaffolding and fell 27 floors to his death. Construction has been halted for years and no date has been set for its resumption.

Taxpayers Suffer

The consequences of this race to the bottom are not limited to non-union workers. Or to the unlucky real estate buyers who end up holding the bag on shoddily constructed money pits. There is a profound cost to the everyday taxpayer as well. 


High-rise construction is among the most difficult and dangerous work one can do. And yet, among the men and women who work in New York construction, at least 41% are enrolled in one or more social safety net programs, because their wages and benefits are not enough to make ends meet. As a result, unscrupulous contractors are defrauding the government at a rate of $3,000 dollars per exploited worker per year. This is great, if you are a non-union contractor saving money on your bid by outsourcing your costs to the taxpayer. But not so great if you are a taxpayer.


For those keeping count, all that fraud adds up to $2.06 billion spent on social safety net programs for New York construction workers per year. Put another way, over $2 billion in New York taxpayer dollars are going directly into the pockets of non-union developers who can’t be bothered to take care of the workers risking life and limb to make them rich.


In addition, a shocking 24% of construction workers have no health insurance coverage. Three hundred percent more construction workers are uninsured than other workers, while they perform a job that is arguably the most punishing on a person’s physical health. Not only does this cause hardship for uninsured workers and their families, it is a massive expense for New York taxpayers. While the number has not been directly calculated for New York, it is well over $40 billion nationally. Given New York’s relative population and GDP, the bill is likely an additional $2 billion or more passed along to everyday New York tax payers. 


Sadly, these numbers do not take into account undocumented workers, who make up a significant percentage of the non-union workforce. With those numbers added in, we believe the real costs to taxpayers is even higher. 


The corrupt non-union contractors are cheating all of us. If you are an everyday taxpayer fed up with subsidizing wealthy developers, the simplest thing you can do is spread the word and normalize asking, “who built this building?”


Mark Colangelo is a writer and blogger.

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