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PROFESSIONALIZING THE CONSTRUCTION
INDUSTRY: Kirk Alter and Bradford L. Sims Reprinted with permission from the Proceeedings of the 33rd Annual Conference of the Associated Schools of Construction In spite of what construction educators would like to believe, the construction industry as a profession has negative connotations among the general population, construction industry design professionals, and other professionals in general. Parents and high school guidance counselors think construction management education is akin to vocational training, while casting glances of longing upon and encouraging young people to pursue careers in engineering and architecture. This perception of the construction industry- as unprofessional, unsophisticated, non-technically rigorous, and even crude is the result of an industry unwilling to voluntarily and adequately regulate itself, while lobbying successfully to forestall any minimum uniform statutory regulation in the areas of licensing and continuing education. If the construction industry is to hope to meet its coming manpower needs for both tradespersons and managers it must set out to create a more positive and professional image for itself. If it accomplishes this, it may also find a welcome secondary effect in the form of increased profitability.
"Why have statewide licensing of beauticians but not electricians?" asks Mayor Sonya Margerum of West Lafayette, Indiana, in expressing her frustration over Indiana’s failure to pass legislation mandating statewide testing licensing standards in the construction industry (S. Margerum, personal communication, October 13, 1996). The construction design process is rife with statewide licensing and certification requirements. Architects, engineers, and land surveyors must possess credentials verifying their education and experience, and must pass rigorous testing in order to practice in each of the fifty United States. Contractors, however, must only be licensed in 31 states, and of those, only 14 states require any sort of exam in order to earn a license (Dreger, 1988). Is it any wonder that the construction industry is poorly perceived, and is rated near the bottom of the list of career choices for young people today? If the industry is to attract young people to fill the roles of trades person, manager, and owner of the future, it must take the steps necessary to professionalize itself. Some of the ways to do this include embracing mandatory statewide licensing of contractors, mandatory continuing education requirements for contractors, and professional certification programs. States vary greatly on the expectations of the contractors who perform work within their borders. In Indiana, the contractor has only to pay for his or her license in each county and/or city that requires a license. In Florida, the contractor must pass a comprehensive exam to obtain a license and then attend continuing education classes to maintain the license. This paper will evaluate what some of the problems associated with states' requirements are, and give recommendations to solve those problems.
States with a history of natural disasters and those with a high rate of population growth have tended to recognize the need for contractor licensing and continuing education in recent years. The National Association of State Contractors Licensing Agencies (NASCLA), an organization in Arizona, provides an annual yearbook that lists contractor licensing requirements by states, and indicates which require mandatory continuing education. The organization is also an advocate for increased standardization of state contractor licensing tests. In Florida, the state contractor licensing test was initiated in the late 1980's, and mandatory continuing education was initiated in 1993.
The issue of licensing of contractors today is characterized best as a political football bandied about by special interest groups in the construction industry. Those arguing in favor of licensing cite public safety, quality control, and industry integrity as primary reasons to institute statewide licensing in all of the fifty states. Those arguing against licensing vilify the process as a barrier to free enterprise and a further imposition on the small business person. At first blush, it may seem that the argument against mandatory statewide licensing may be particularly credible. There is no widespread failure of buildings in non-regulated states. Competency licensing of builders would not have prevented the tragic Kansas City Hyatt-Regency Hotel disaster in 1981 which killed 114 people, or the collapse of the L'Ambiance Plaza apartment building at Bridgeport, Connecticut, which took 28 lives (Dreger, 1988). Additionally, there has been no quantitative study performed to discern if there is a difference in the quality of construction between regulated and non-regulated states. So why then have licensing at all? What real factors control the quality and safety of the construction process? Should the states be involved or should the industry be self-governing? What role does licensing have in protecting public welfare and promoting professionalism and ethics in construction?
Unlicensed contractors are a bane to the construction industry. First, they hurt the industry's image. In an industry severely challenged to provide adequate manpower at both the tradesperson and management levels in the coming decades, it seems imprudent to ignore the need to professionalize and legitimize the construction industry. The image of the uneducated, boorish construction worker persists in the mind of the public, and results in the active redirection of students away from careers in the industry by parents and high school guidance counselors. Further, each year thousands of consumer complaints are received about the quality and performance of construction services which are mostly the result of the work of unlicensed individuals or firms unaccountable for their abuses (Dreger, 1988) and (Maloney, 1987). Second, unlicensed contractors represent unfair competition in the construction marketplace by avoiding paying taxes and state benefits such as unemployment and workman's compensation. Illegal contractors can and do undercut legitimate contractors on price (Maloney, 1987). The activities of unlicensed contractors account for a significant underground economy. Potentially billions of annual revenue dollars are changing hands without taxation, resulting in the loss of many millions of dollars in annual revenue to the states.
If the basic premise is that unlicensed, unregulated, and unqualified contractors present an obstacle to professionalizing the construction industry, then the task is to propose solutions which may remedy the problem. The first proposed solution is statewide mandatory licensing tests. These tests can be tailored to give a license to only specific types of construction work, for subcontractors as well as general contractors. Additionally, before a contractor can take a licensing test, a requirement should be established for either a minimum amount of experience in construction, or possession of a construction-related college degree. The licensure tests could be standardized for many states, or states may elect to write test questions specific to their region of the country.
Occupational licensing is defined as the exercise of the state's inherent power to protect the health, safety, and welfare of its citizens. Generally accepted criteria for granting any licensure includes: 1. unqualified practice poses a serious risk to a consumer’s life, health, safety, or economic wellbeing; 2. such risks are likely to occur; 3. the public cannot accurately judge apractitioner’s qualifications; and 4. benefits to the public clearly outweigh potential harmful effects of licensure (such as a decrease in the supply of (practitioners) (Dreger, 1988). It seems obvious that all of the above criteria may easily be applied to contracting. There is not one agency nationwide that regulates how a contractor obtains and maintains a license to perform work. While we are not advocating that a U. S. government agency provide this service, we are suggesting that the various states take a more standardized approach to licensing and continuing education requirements. States such as Florida, which has testing to obtain a license to work in the state and mandatory continuing education requirements to maintain this license, and California, which requires trade and business testing, appear to provide their citizens some assurances that the contractors are credible.
The term contractor may be defined as any person who undertakes, or offers to undertake, or submits a bid to, or does construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building, highway, road, railroad, excavation or other structural project, development or improvement including the erection of scaffolding or other structures or work in connection therewith. The term contractor includes subcontractor and specialty contractor (Peerless, 1995). A good example of contractor classifications for licensing purposes is the California model, and includes the following classification: General Engineering Contractor. Principal business is in connection with fixed works, such as irrigation, drainage, water power, water supply, flood control, inland waterways, harbors, railroads, highways, tunnels, airports and runways, sewers, and bridges. General Building Contractor. A general building contractor is one whose contracting business is in connection with any structure built or being built for the support, shelter and enclosure of persons, animals, personal property or movable property of any kind, requiring in its construction the use of more than two unrelated building trades or crafts. This means a contractor hiring a plumber, a carpenter, and a painter must have a General Building Contractor's License (Peerless, 1995). Specialty Contractor Classifications. A specialty contractor is a contractor whose performance in construction work requires a special skill and whose principal contracting business involves the use of specialized building trades or crafts. Under California contractor licensing law the following specialty trades are classified, tested for trades competency, qualified by experience, and licensed: 1. Boiler, Hot Water Heating and Steam
Fitting
The second solution is a mandatory continuing education program for contractors to maintain their license. Many other professions have long ago adopted mandatory continuing education as a means of ensuring that their licensed practitioners maintain a high level of expertise in their respective fields. Teachers, attorneys, physicians, and nurses, to list just a few, all have to fulfill mandatory continuing education requirements. The purpose of these requirements is to create an environment of lifetime learning to ensure that the professions as a whole maintain high continuing standards of excellence (Indiana Professional Standards Board, 1996). The result of these standards is, for the most part, a high degree of public confidence in the ability of registered practitioners. To set up continuing education programs, a detailed list of rules needs to be developed. This list of rules should include the establishment of the qualifications of course instructors. There must be a board to set up the standards and format of each class. The board will also need to review each proposed class and approve or reject the class based on previously established standards and format. Under Florida law, it is stated that the purpose of licensing and continuing education for contractors is as follows: The Legislature recognizes that the construction and home improvement industries may pose a danger of significant harm to the public when incompetent or dishonest contractors provide unsafe, unstable, or short-lived products or services. Therefore, it is necessary in the interest of the public health, safety, and welfare to regulate the construction industry. Continuing education can help to educate contractors on changing legislation affecting the industry while helping to foster professionalism in the industry. One goal of continuing education that should be striven is stimulating, continuous, practical, and evidence-based learning, designed to maintain and improve the competence of all construction professionals. As an example of well-crafted criteria for a professional continuing education program, the Faculty of Medicine at the University of Toronto has made an effort to ensure the following for all their continuing education classes 1. that course development follows principles of needs assessment; 2. that learning objectives are clearly established; 3. that formats are chosen which are appropriate for the given objectives and target audience of the course; and 4. that evaluations of learner satisfaction withthe course and its faculty are carried out. An example of the legal profession's approach to mandatory continuing education is the Federal Judicial Center's specific statute that directs the Center to develop, conduct, and stimulate educational programs for all judicial branch employees and for "other persons whose participation in such programs would improve the operation of the judicial branch" (Federal Judicial Center Act, 1967). The continuing education programs should enhance the administrative and management skills, conduct periodic national conferences, create programs to develop particular job skills, and promote the quality and quantity of local training. Once the goals and rules of the continuing education are resolved, mandatory continuing education relicensure requirements can be established. California provided the first mandatory continuing education relicensing requirements for nurses in 1976, and Florida provided a mandatory continuing education licensing requirement of 14 hours every two years for contractors in 1994. Florida's requirement allows the board to maintain a basis for a high standard of practice from the contractors and establish requirements which will assure reasonable currency of knowledge. The continuing education classes can provide both community service courses and professional development courses. Community service courses would provide owners, building managers, facility managers, and professional organizations such as the Building Owners and Managers Association (BOMA) and the Association of Plant Engineers with classes that are of special interest and provide for greater insight into the construction industry. Professional development courses will help employees stay current in their industry. These continuing education courses can be in hourly increments, special seminars, workshops, or training programs. Continuing education courses are already a mandatory relicensing requirement for contractors in some states. These courses provide the contractors with information to keep them updated in new laws, new technology, and refresh their memory on a variety of construction-related subjects. Qualified faculty from the varied construction university programs provide some of this training. As the necessity of these mandatory continuing education classes becomes prevalent across the nation, it is the job of the construction industry faculty to take a leading role.
The failure of the large construction organizations in the United States such as the AGC, ABC, AIC, NAHB, NECA, IEC, MCA, PHCC, and so on, to embrace mandatory statewide licensing (Dreger, 1988) has been the largest impediment to achieving successful licensing legislation. Their preferred means of regulating the industry is through some sort of self-regulation of competency for constructors by the practicing constructor. To date though, this seems to have been particularly ineffective as a means of "regulating" the industry, as the professional credibility issues in the construction industry persists. While all of the organizations cited above list education of their contractor members as the number one priority (and most provide quite good educational resources), membership requirements of each organization essentially boils down to whether or not the company or individual is a dues-paying member in good standing, and (for organizations requiring unionization) whether or not they choose to remain as union contractors. There does exist a movement within the industry to certify managers of the construction process at the individual, rather than firm, level. The American Institute of Constructors (AIC) has just begun (1996) a construction certification process whereby the individual who successfully meets the stated experience and education criteria qualifies to sit for a national examination to gain certification as a Certified Professional Constructor (CPC). The stated goal of certification is to "raise the standards of the practice of the Constructor, thus benefiting all parties involved in the construction industry, including society at large" (AIC, 1996). This certification closely mimics the widely accepted and recognized certification program in the United Kingdom sponsored by the Chartered Institute of Building (CIOB). The core of CIOB's work is "the recognition that professional standards of management are essential to the continued success of the industry" (CIOB, 1995). The impetuses behind the professional certification process as defined by the AIC (AIC, 1994) are: 1. Increasing complexity of construction projects. 2. Increasing specialization of construction processes and organizations. 3. The need for closer coordination and cooperation 4. Owners placing more emphasis on management skills, service delivery and the execution of projects by demanding better performance, productivity and quality in the construction process. 5. Evolution of project delivery systems such as Construction Management, Design-Build and Program Management. 6. More involvement by construction contractors in direct consultation with project owners. 7. Increasing governmental regulation with regard to working conditions, hiring practices and safety. 8. A more diverse work force. 9. Greater fragmentation of the industry as divergent parties affect standards, policies and positions, in many cases to protect self-interests. 10. Decline in the 1970's and 1980's of craft training programs. 11. Declining image of construction work and workers leading to a decreased attractiveness of construction as a career. 12. Need for implementation of new technologies in the construction process. 13. Increasing litigation affecting the entire industry. 14. Increased international competition. 15. Decreasing profit margins throughout the industry. Most of the impetuses listed above are the same as those for advocating mandatory statewide licensing and continuing education, but are aimed at the individual rather than the firm. While the intent is sound - - to raise the standard of the individual manager of construction services- - the industry will surely benefit over time if enough individuals voluntarily go through the process, the lack of regulatory mandate will more than likely render the certification as a professional "nicety" rather than an expected standard. Certainly we are pleased when our physicians and attorneys are certified by their respective professional organizations, the AMA and the ABA, but as consumers of medical and legal services, we are comforted in knowing that we are protected via the state mandatory licensing and continuing education statutes. There are many other voluntary certification programs offered throughout the industry. The Project Management Institute offers certification as Project Management Professional (PMP), the American Association of Cost Engineers (AACE) offers certification in cost engineering, the American Society of Energy Engineers (ASEE) offers certification as a Certified Energy Manager (CEM), and so on, ad nauseum. While all of these programs are quite good, and the individuals who have earned these credentials should be respected in their fields for their knowledge and experience, this voluntary process has done very little outside of those very specialized and localized areas to raise the credibility of the industry as a whole. Perhaps many years in the future the benefits will be seen of this type of voluntary effort, but a lasting and immediate impact is not evident today.
The construction industry suffers from a perpetual negative image problem among the general population, other professions, and even among construction industry design and management professionals. This image provides the largest single impediment to the recruitment and retention of young people into the industry, and promises to significantly alter the industry unless overcome. Additionally, contributing to the perception of the industry is the lack of consumer confidence of the training, skills level, and management and delivery capabilities of the professional constructor. While the root cause of this negative perception is the result of many factors, a solution to positively altering this paradigm is to enact mandatory measures in an attempt to professionalize the industry. If all contractors were required to demonstrate their competency in the areas of business management, trade skills, safety, quality control, and customer service as well as demonstrating minimum levels of financial solvency, a large step would be taken towards establishing industry credibility. Mandatory statewide licensing as an outcome of trade and business management exams, proof of trade experience and competency, and demonstration of financial solvency would satisfy this requirement. Licensing alone, though, is not enough. Some states currently have mandatory licensing with testing, but still suffer from a credibility problem. The best way to remedy that is to ensure that any licensure system include requirements for the demonstration of continued competence, and mechanisms for the ongoing evaluation of license holders. This requirement is best satisfied via carefully crafted, and industry-wide continuing education networks designed to keep industry members current on new technologies, markets, and efficient business practices. Finally, the missions of organizations such as the AIC, PMI, AACE and CIOB to create a standard for professionalism among the individual managers in the industry should be supported by educators, industry officials, and purchasers of construction services in order to foster the next generations of constructors. While the impact of voluntary certification will be minimal for years to come, if the standard is supported, it will, in time, become meaningful. All of these recommendations together- mandatory statewide licensing, mandatory continuing education, and voluntary professional certification- will allow the construction industry to make giant strides in professionalizing itself, and should also result in more satisfied customers, a larger customers, a larger potential tradesperson and management labor pool, and increased profit margins as the added value of professional constructors is recognized and rewarded by consumers.
Chartered Institute of Building. (1995, March). Membership Regulations and Guidance Notes on the Professional Interview. Ascot, England: The Chartered Institute of Building. Construction Certification Commission. (1996, March). The Professional Constructor Candidate Handbook. St. Petersburg, Florida: American Institute of Constructors. Construction Certification Commission. (1994, March). White Paper on Constructor Certification. St. Petersburg, Florida: American Institute of Constructors. Dreger, Garvin T. (1988). Competency Licensing of Building Contractors. Proceedings of the 24th Annual Conference of the Associated Schools of Construction, 42- 50. Federal Judicial Center Act, 28 U.S.C. ss 620 (a) (1967) Indiana Professional Standards Board. (1995). Continuing Education- Teacher License Renewal and Continuing Education. Indianapolis, Indiana. Maloney, John. (1987, August). Doing Something About Unfair Competition in Contractors Amnesty Program. Sacramento, California: Department of Consumer Affairs, Contractors State Licensing Board. Peerless Institute. (1995, 8th ed.) Contractors License Law. Long Beach, California: Peerless Institute Press. State of Florida. (1994). Chapter 489 Part 1. Construction Contracting Law. Tallahassee, Florida. State of Colorado. (1990). Colorado State Statute 12-2-119. Denver, Colorado. Kirk Alter is connected with the Department of Building Construction Management at Purdue University, West Lafayette, IN. Brad Sims is connected with the Department of Building Construction at the University of Florida. Dr. Sims may be contacted via email at brad@constructioneducation.com or telephone (352) 392-7288. Return to the List of Articles |
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