Construction and manufacturing leaders had their say in Washington, D.C., in recent weeks, both at the White House and on Capitol Hill. Topics ranged from the importance of apprenticeships, the need for deregulation, the effects of President Donald Trump's steel tariffs and technology's role in infrastructure projects.
On Dec. 6, a group of industry leaders met with President Trump, Vice President Mike Pence and cabinet members to talk about the impact that government regulations have on their businesses.
Drew DeWalt, co-founder of construction technology firm Rhumbix, told the president that in his visits to construction companies across the country, he hears a lot about the negative effect that some "overdue-for-a-good-look" regulations have on the industry.
"I see a lot of companies doing federal contracting work that have added costs to their business — of specific software and overhead and head count just for compliance," he said. "No other economic result on the business, other than making sure you’re compliant or you’re going to get fined later."
Trump agreed, saying, "Sure. It's too much."
In the roundtable meeting in the West Wing's Roosevelt Room, DeWalt told the president that technology like his company's field data capture system is important in helping move the industry forward, but not as important as removing regulations.
"I think the regulation piece, candidly, is a bigger opportunity — that everybody is championing around this table — so that you can actually look for opportunities to remove duplicative regulations from the federal, state, and local level that actually drive even more efficiency," he said. "Because it’s the second-largest industry in the nation, and if you can put more juice in the tank there, you can get even better results."
Transportation Secretary Elaine Chao told the group that her agency is working hard to deregulate infrastructure construction and noted that the administration overall has been withdrawing about seven regulations for every one it introduces.
Trump told the gathering that his administration will continue its "bold deregulatory campaign" next year. "A lot of the things we are doing are based on common sense," he said. "Somebody said, 'Is that a conservative, is it a liberal thing?' I said, 'It’s a commonsense thing.'"
The impact of tariffs
DeWalt noted that despite these regulations, his customers tell him that the industry is booming more than ever before and that the only thing holding them back is "finding enough people to do the work."
"So if we can ... drive more people and encourage more people to join the trades, which is a lucrative individual business and can prop up this part of the economy, that would be welcomed," he said.
Barb Smith, president of Cincinnati-based Journey Steel, told the president about the importance of apprenticeships for enticing young workers to the industry. Journey has a year-round paid, pre-apprenticeship program that targets inner-city high school seniors.
Trump talked about his recent steel tariffs and their affect on the manufacturing of the material in the U.S., saying that if he hadn't been elected, "I don't think we would have had a steel industry" because of low-cost Chinese imports.
"And now the steel industry — if you look at what’s going on, the industry is doing incredibly well," he said. "They’re building a lot of extensions. They’re building brand-new plants where ... they never built a new plant."
Dana Weber, CEO of Webco Industries, said that the president's trade policies have been a huge plus for her company. The Oklahoma-based specialty steel tubing fabricator has been paying profit-sharing bonuses and wage increases at record levels over the last few years.
"We are having companies, customers come out of the woodwork that we didn’t even know existed ... to inquire and to buy steel from us," she said.
Small business gathering
The White House meeting came on the heels of another legislative huddle involving construction pros. The House Subcommittee on Small Business, chaired by Rep. Jared Golden (D-Maine) held a hearing in late November focused on the intersection of small business, technology and infrastructure construction.
Construction industry leaders served as expert witnesses in support of the American Transportation Infrastructure Act, particularly the section that provides funding for states and localities to adopt digital construction management systems for the bidding, design and execution of infrastructure projects.
This provision would provide $20 million per year from fiscal year 2021 through fiscal year 2025 to increase state and local use of digital construction management systems.
Ryan Forrestel, president of Cold Spring Construction in Akron, New York, told legislators that although there is a perception that the greatest challenge facing small businesses that want to integrate digital construction is the cost, the greater challenge is the slow rate of adoption across the construction industry as a whole.
"Like any other change, the adoption of these technologies has been met with some resistance. In some cases, it is because of lack of familiarity and agencies failing to adjust specifications to allow for its use," he said.
Broader adoption of technology across the industry and increased understanding of technology by state and federal agencies would reduce these issues, he said.
Phil Ogilby, founder and CEO of Stack Construction Technology, asked committee members to consider mandating the use of technology solutions for all government-funded projects, not just at the general contractor level, but for subcontractors and other project partners as well. He also asked them to think about how tax incentives and grants might be used to encourage the industry to make new investments in technology.
Chris Shephard, vice president for the Construction Solutions Group at Trimble, noted that while state transportation departments are interested in technology solutions, they often compete for scarce resources. He said that funding from the federal government would help accelerate the advancement of tech tools.
"Congress has a once-in-a-generation opportunity to transform the federal investment in infrastructure by incentivizing states to adopt modern, commercially-proven, and competitively acquired digital construction management systems and processes for infrastructure projects," he said.