State Department of Labor and Workforce Development officials have added five construction trades to a list of occupations with which contractors will have to achieve 90 percent Alaska-hire on construction projects financed with public funds.
Boilermakers, foremen and supervisors, sheet metal workers, surveyors, and tugboat workers were added to a list of 21 construction-related occupations to which the 90 percent preference applies. The list was last revised in 2005.
The determinations are made on an analysis of resident-hire in each of the occupations.
“The data prove we have to work even harder to provide training and create job opportunities for Alaskans,” Click Bishop, commissioner of the state Department of Labor and Workforce Development, said in a June 26 press release making the announcement.
Dick Cattanach, executive director of the Associated General Contractors, agrees that the state should ramp up its training.
“I'm not sure why the construction industry should be tagged with a requirement to hire 90 percent Alaskans when the state's total workforce is only 83 percent, but if state government is going to set a higher standard for contractors than other industries, it should at least provide more money for training,” Cattanach said.
Grey Mitchell, director of the state Labor Standards and Safety Division, said that if employers are unable to find qualified Alaskans in the indicated trade group they can apply for a waiver to hire nonresident workers, but they must first advertise and post notices in job centers located around the state.
Firms that ignore the requirements are subject to fines, although contributions to training programs can be made in lieu of fines, Mitchell said. Employers paid $15,834 in fines in the 12 months prior to May 2007, Mitchell said. Fines of $76,000 were paid for the 12 months prior to that, he said.
The requirements do not apply to private construction projects.
To make the determinations, state labor economists review employment data filed by employers and match the data against Permanent Fund Dividend information, which is considered the best available information on resident status.
In the latest determination, employment data from the third quarter of 2006 was used, according to Jeff Hadland, an economist in the labor department's research and analysis section. This was matched against Permanent Fund Dividend applications in 2006 and 2007, he said.
Percentages of nonresidents working in each occupational category are developed on this basis. The information is then compared with data on Alaska residents seeking jobs and filing unemployment claims who have the same skill sets, Hadland said.
In a paper prepared to explain the 2007 determinations, Hadland's research showed, as an example, that of 4,040 carpenters working there were 648 nonresidents, but 1,294 residents with carpentry-skills available for work. Based on that, the 90 percent Alaska-reference was triggered for carpenters.
Research also showed that of 6,071 equipment operators employed during the third quarter of 2006 there were 1,321 nonresident operators, while 1,388 residents with the skills needed were listed by the department as available for work.
Of 1,767 plumbers and pipefitters working there were 397 nonresidents, but 392 residents with these skills registered as unemployed or seeking work.
The only construction-related occupations where the department determined there were sufficient residents at work were engineers and architects. The department's data showed that of 2,303 employed during the quarter, 494 were nonresidents, while there were 241 residents with engineering and architect skills listed as available for work.
Hadland said the analytical process is conservative in its estimates of available resident workers, because it does not include potential workers who have exhausted their unemployment benefits or who did not register with the department as being available for work.
Bishop called on Alaska-based firms to increase efforts to hire residents.
“To complement our efforts here at the department, I challenge all employers in Alaska to develop apprentice training programs and start growing their own workforce with local Alaskans,” he said in the June 12 press release.
State efforts to require or encourage hiring of resident workers have a long and tangled history. A 1972 law requiring hiring of qualified Alaskans as a condition of a right-of-way lease on state lands for construction of the trans-Alaska oil pipeline was struck down by the courts as unconstitutional.
Another effort by the state, in the mid-1980s, to require resident-hire on state-funded projects in parts of Alaska with high unemployment, was also struck down by the courts. The requirement for construction contractors to achieve 90 percent comes out of a state regulation rather than a statute.
Tim Bradner can be reached at tim.bradner@alaskajournal.com
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