SECTION: CAPITOL HILL HEARING TESTIMONY

LENGTH: 1368 words

HEADLINE: TESTIMONY July 21, 1999 RONALD KINNING PRESIDENT RK MECHANICAL INC. HOUSE EDUCATION AND THE WORKFORCE OVERSIGHT AND INVESTIGATIONS JOB OPPORUNITTIES IN CONSTRUCTION

BODY:
Testimony of Ronald Kinning President RK Mechanical, Inc. Before the Oversight and Investigations Subcommittee of the House Education and Workforce Committee Jobs in Construction: Impact of Hiring Helpers under the Davis- Bacon Act July 21, 1999 Mr. Chairman and members of the Subcommittee, thank you for the opportunity to testify before you today regarding the impact of Davis-Bacon rules on "helpers" job opportunities. My name is Ron Kinning. I am here today representing RK Mechanical, Inc. and Performance Building Services. These companies are co-owned by my two sons and myself. Our corporate headquarters are located at 9300 East Smith Road in Denver, Colorado. We also have a branch office in Colorado Springs, Colorado. I began my career in 1957 after graduating from high school in rural Eastern Nebraska on the southwest edge of the Winnebago Indian Reservation. College was not affordable for me at that time. Fortunately, I was able to seek employment as a plumber and sheetmetal helper. After approximately four years, I moved to Longmont, Colorado and within six months passed the Colorado State Journeymen Plumbers Test. In 1963, my family and I moved back to Pender, Nebraska where I started my own company. During the first five years, my company worked on non- governmental projects, which were not restrictive on helpers or trainees. In 1968, we entered into the governmental sector completing housing for the elderly which included Davis Bacon wage rates. By that time, I had trained a crew of approximately 25 Journeymen and, with the use of laborers, I was able to complete the projects while complying with the Davis Bacon requirements. In the early 1980's, my company was growing. Finding trained manpower became a problem. We were building medical facilities, university projects, Corps of Engineers projects, General Services Administration projects and housing facilities. We also employed over 400 people. Due to the lack of skilled manpower and an aging workforce, we made the decision and financial commitment to established our own in-house Bureau of Apprenticeship and Training (BAT) Program. During the start-up of the Apprentice Program, we encouraged our apprentices to work as helpers for a period of time. This gave them a chance to learn more about the construction industry and decide if this is the career path they would like to follow. With this limited knowledge about the industry before they enrolled in the training program the drop out rate was substantially reduced. This program was very successful and by mid 1985, we had over 850 employees and were working in 26 states. This past season, we had 98 apprentices in the program and ended the year with 82. We were able to maintain over 80% of our apprentices under this helper program versus less than 50% from enrolling people without any experience. We also have targeted the minority community. Helper positions are an important part of entry for young people, minorities and women into the industry who might otherwise be excluded due to lack of experience or skills. Helpers allow semi-skilled workers with little or no previous training access to entry-level job opportunities and the ability to earn a living while enriching their technical skills. Today, RKMI is the largest mechanical contractor in Colorado. We project our sales this fiscal year ending September 30, 1999 to exceed $70,000,000 and employing approximately 650 full time employees. Helpers are a strong first step in the job ladder for workers who are interested in pursuing a career in construction. This industry can provide a career path with no limits. There are many journeymen, front office staff and vice presidents that began their careers as helpers. Jim Hoden, Vice President of the Pre- Construction Department, began his career at the age of 13 as a helper carrying tools and learning inventory in his family business. He was learning the trade during his summer breaks from school and continued working in the field as he went to college to get his degree in Business Administration. After college he decided he enjoyed the construction industry and saw the opportunity to advance as well as increase his income. After college he got his Journeymen's license and 15 years later he is a Vice President at RK Mechanical, Inc. Another RKMI employee, Mark Dalton, began his career in the construction industry seven years ago at the age of 30. He worked for a fish hatchery plant until the plant shut down and he found himself unemployed. Since he had a new house and new family, he needed a job immediately. His neighbor happened to be an owner of a plumbing company and offered him a position as a helper so he could at least bring home a paycheck. After working as a helper for a period of time, Mark decided there was a career path in the industry and joined the plumbing Apprenticeship Training Program. After getting his journeymen's license he worked as a field superintendent for five years. He progressed to Purchasing Agent for one year and today he is a Plumbing Estimator for RKMI. He has also been one of RKMI's Apprentice Instructors for the past three years. Eight years ago Mark never stepped on to a construction jobsite. This opportunity gave him a chance to explore the construction industry and see there was a potential future for him and his family. Despite what the current U.S. Department of Labor tries to claim, helpers exist and are widespread in the construction industry. Some people are content with going to work, doing their job at their current low-skilled level and collecting a paycheck every week. Others want the chance to develop a career and continue to excel and take on more responsibility. Thus they have the opportunity to participate in a more formal apprentice program option. RKMI, as a company, pushes their people to acquire as many technical skills as possible in a safe working environment. As the helper learns more skills and does a good job, his salary increases. Some helpers don't desire to learn more skills or are not well suited for formal training programs. They may be working multiple jobs or they may not like structural training programs therefore, it is a mistake to assume all helpers progress to apprentices or journeymen. This flexibility is necessary in our industry. I would also like to draw attention to RK Mechanical's outstanding Safety Program and Drug Free Workplace. Safety at RK is a priority on every job not just governmental projects. The attached awards prove this fact. Davis Bacon does not ensure a safe workplace as some people believe. Our Safety Program has also has cut our insurance expense dramatically. Our state workmen's Compensation Modifier is 0.51 and, according to our Insurance Carrier, this rating is the best in our industry. Our helper apprentices and Journeymen work together as a team. As industry leaders we all need to put time and money into training our future craftsmen. Some people say "What if I train people and they go work for my competitor." I say "what if we do NOT train our people and they continue to work for us." The helper classification has not been dealt with fairly by many organizations. We as business leaders, need to remove the road blocks and give our young people a chance to learn and excel. The Bureau of Labor Statistics (BLS) has released a pilot study (Wages and Benefits Construction Industry Test Survey," Jacksonville, Florida, October, 1998) which revealed that helpers are over 10% of the construction labor force. My first job as a helper in 1957 paid $1.25 per hour. If I did not have that opportunity to learn and grow in the construction business, I may not have been able to establish and maintain my 70 million dollar company today. RK Mechanical, Inc. and Performance Building Services belong to the following trade associations: The American Subcontractors Association, The National Association of Plumbing and Heating Contractors and the Associated Builders and Contractors, Inc. (ABC). I believe in the ABC merit shop philosophy -- the belief that construction work should be awarded and performed on the basis of merit, regardless of labor affiliation.

LOAD-DATE: July 26, 1999