Construction diversity is still a work in progress

Projects that meet inclusion goals remain ‘atypical’

Part one of a two-part story

Construction season in Minnesota is often marked by warm weather, orange cones, and the occasional traffic jam. This year’s season had all the hallmarks and more as the Minnesota Department of Transportation announced that it had over 200 construction projects planned for 2021. 

The most prominent of these projects has been the 35W Downtown-to-Crosstown freeway reconstruction project, which took four years and $239 million to complete. Though its size and scope were large, the project also received recognition for exceeding the expectations in its workforce diversity goals. 

The goals for the 35W project were to include 6.9% women and 32% POC as construction employees to meet state and local requirements of workforce inclusion. This feat was achieved through the efforts of State-led job training programs and private contractors joining resources to recruit more workers. 

Officials referred to this achievement as “atypical.” A recent report from the Star Tribune revealed that diversity goals for the workforce are rarely met on construction projects in the state. 

In the past two years, several construction companies have failed to employ a single woman or POC to become a part of their construction team. State and local agencies are working to fix these shortfalls by supporting job training programs and recruiting from diverse communities.

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They’re also encouraging prime contractors, the companies who work directly with government agencies and hire subcontractors, to boost their outreach efforts to hire more diverse employees.

According to the Minnesota Department of Employment and Economic Development (DEED), construction is the 10th-largest industrial sector in the state and was projected to be the second-fastest-growing industry sector between 2014 and 2024. To help sustain this growth, state and local officials have pushed for the hiring of women and minorities by large construction firms. 

They have also made an effort to enforce statutes that award contracts to prime contractors who subcontract a certain number of women and minority-owned businesses. These businesses, often referred to as disadvantaged business enterprises or DBEs, are supported by both state and federal statutes to be a part of large public contracts. 

Though much of the reporting around workforce diversity goals has focused on construction projects at the State level, these shortcomings are also seen at the local level with City and County contracts. 

City enforcement

Both St. Paul and Minneapolis city governments have departments dedicated to enforcing contract compliance with large prime contractors. In St. Paul, this work is done through the Department of Human Rights and Equal Economic Opportunity (HREEO) and its contract compliance and business development division.

  The City of Minneapolis’s Department of Civil Rights handles workforce goals through its contract compliance division. Aidan Dunne is a compliance analyst for the civil rights department and works with prime contractors to promote opportunities in the construction industry amid demographic changes. 

“It’s not just a fairness and equity issue,” he said, “but also just as a practical matter. Construction firms need workers and demographics are changing. You can’t keep hiring the same White men decade after decade if you’re going to get the staffing you need to do these jobs.” 

Dunne’s office is brought on to oversee public projects after they’ve undergone a preliminary review by the procurement office. Any project over $175,000 is handed off to the contract compliance division in Minneapolis. 

St. Paul’s contract compliance division is triggered once a city contract exceeds $50,000. These projects may be for paving a city street, constructing housing units, or working on a public building. If there are public dollars involved, goals are set. 

Contract compliance officials in both cities meet with prime contractors who bid on these projects and review their proposals. They select offers based on the lowest bid, although other factors are considered. Part of the prime contractor’s bid is to include the number of subcontractors they plan to utilize and the money they plan to allocate for DBEs. 

Both of these offices track the progress of these projects by recording the data provided by the prime contractors and updating their public records with this information. Minneapolis uses an interactive Diversity and Inclusion Dashboard to showcase where these public contracts stand in contrast to their original goals. Projects listed on the site go as far back as 2015 and display both the total project hours and cumulative contract amount with the percentages of diversity inclusion that was involved. 

Compliance officials like Dunne take information from prime contractors at the closeout of a project and begin to enter this information as the paperwork is finalized. Although construction on a project may be finished, the information on the dashboard might not reflect that for many months. 

“Closeouts of these contracts are not going to happen the same week or the same month that the job ends. Sometimes we’re just so overwhelmed that we don’t have the staff time to dedicate to it,” Dunne said. 

St. Paul provides its residents monthly updates on the inclusion efforts for certain projects such as the Highland Bridge site. Their September report indicated that minority workers made up over 35% of the workforce. 

They also publish a yearly report that tracks workforce inclusion goals and metrics. The 2020 report indicated that minorities made up just under 23% of workforce hours on City projects that totaled 1.8 million hours. 

Public-private partnerships

To help achieve their goal of including more POC in the construction workforce, City agencies have created partnerships with local community-based organizations to help drive that change forward. 

Part of Dunne’s work as a contract compliance officer has been to help support the workforce training pipeline. He has worked with community-based organizations such as Summit Academy OIC to inform them on what the City is looking for in terms of workforce development. On occasion some of these organizations receive City funding to help increase the number of POC with construction training.

However, Dunne stated that most of the recruiting work is done in reaction to the needs of the industry. “Our team is reactive,” he said. “We have to deal with the landscape.”

Alexander Dumke is the acting public information officer at HREEO. He said the department has partnered with the Construction Careers Foundation to help St. Paul residents from underrepresented backgrounds receive the relevant education and training to secure jobs in construction. 

“Over the last two years, HREEO has certified 102 residents as Section 3 job seekers through the Construction Career Pathways program,” Dumke stated. Part of CCF’s program is also job placement and offering participants career tracks so they can have some mobility in the industry.