Deep-rooted racial discrimination in the construction industry: despite progress, bias persists

Editor's note: This article is the third part of the "Racism in Construction" series. Clickhereto view the full series.

Greg Page, president of Page Building Group based in Waldorf, Maryland, has a proven business strategy when applying for financing: send a white person to the front.

When he needed $500,000 to expand his previous company to take on government contracts, including an Army project in Belize, he used exactly this strategy.

"Expanding resources like that as a small business is costly, and we didn't have that much capital," said Page, who is Black. "We got the line of credit because my second-in-command is white. I sent him and our administrator to the bank, and they completed 90% of the process. It wasn't until I came to sign the agreement that the bank saw for the first time that I was Black."

Page cannot provide evidence that he would have been denied financing if the bank had known his skin color beforehand, although redlining against people of color is well documented. Instead, Page's 25-year career in construction, along with the look of surprise on the banker's face, was enough for him to intuit the likely outcome.

"They wouldn't easily give me a $500,000 line of credit—are you crazy?" Page said. "On paper we looked fine, but the look on his face when I showed up was like 'I wish we had known earlier.' But by then, they couldn't take it back."

More than nooses and graffiti

Although racist incidents such as nooses and hate graffiti on construction sites made headlines in 2020, racism has existed in the industry for years, often manifesting in more subtle and systemic ways.

Whether it's site visitors looking for a white boss when the foreman is Black, apprentices of color being assigned chores instead of learning the trade, or minority-owned businesses being stigmatized on job sites—according to sources interviewed for this series, it is this systemic, often unconscious bias that constitutes the more common form of racism in construction.

"Racial slurs, racist symbols like nooses, racist graffiti in portable toilets—those are direct and obvious," said Maura Kelly, an associate professor of sociology at Portland State University in Oregon, who has studied racism in construction. "But that's really just the tip of the iceberg."

For example, a Black master plumber in Cincinnati, who asked for anonymity to speak candidly, said some people come to work looking for the lead mechanic but will avoid him and seek out someone else.

"Just the other day, a white guy came in, looked at me, and said: 'Where's your boss?'" the plumber said. "But I'm the lead plumber, I'm the boss. But they'll say 'Where's the boss? Did you think it would be a white guy?'"

Leon Araiza, a Native American contractor in Salem, Oregon, said that when building inspectors come to his site, he is also usually the last person they ask.

"This happens often," Araiza said. "When officials come, whether it's an inspector or a contract official, unless I approach them first, they'll talk to my non-Native white employees first."

The 'FBI' of construction

Nate McCoy, executive director of the Portland chapter of the National Association of Minority Contractors, said many people enter construction through family members, which exacerbates the industry's lack of diversity—an industry that is 88% white, compared to the overall industry average of 78%. In contrast, Black or African American workers make up only 6% of construction, half of the 12% in the overall workforce.

"We call it the 'FBI,'" said McCoy, who is Black. "The way you get into construction is: through your father, brother, or in-laws."

Calvin Williams, CEO of Construction Contracting Services based in Lansing, Illinois, and Midwest vice president of the Associated Builders and Contractors, said these numbers reveal a deeper truth about human nature.

"People hire people like themselves," said Williams, who is Black and holds a psychology degree. "If you haven't had much experience working with African Americans or Hispanics, you'll feel uncomfortable."

In his view, this systemic racism runs through the entire industry. "In the sense that people don't hire or are unwilling to work with minorities, I think that's systemic racism," Williams said. "Because it's embedded in the processes of personnel and contract opportunities."

The 'FBI' of construction also hinders people of color from building networks on job sites and securing better positions. Pat Daniels, executive director of Constructing Hope in Portland, said the organization trains people with criminal records in trade skills. She said her students of color avoid talking to each other while working because doing so would lead to accusations of loafing.

"Black workers on a job site won't stop to talk to each other, even during breaks, because that would be seen as not working," said Daniels, who is Black. "In construction, networking is very important—it's how you find your next job. White people have their networks, but people of color don't."

Kelly found similar evidence in her research.

"We see that women and people of color are unable to access the professional relationships that come with the job," Kelly said.

Sweeping floors, not learning the trade

The apprenticeship hierarchy in construction also fuels systemic racism: apprentices of color are sometimes assigned chores rather than tasks that help them learn the trade.

"White apprentices are taught how to do the work, but my people are just sweeping floors," Daniels said. "If you only do small tasks where you don't learn new skills, you can't advance. Even if you move up to second-year apprentice, you'll be laid off on the next job because you don't know what you're supposed to know."

Kelly's team's research at Portland State University quantified that apprentices of color receive less informal mentoring than white men, and completion rates for apprentices of color are significantly lower than for white men. In 2016-2017, 57% of white men completed their apprenticeship programs, compared to only 41% of men of color.

"I think this is directly related to racist attitudes in the industry," Kelly said.

To improve these numbers, contractors and unions have launched programs to attract more people of color into apprenticeship programs. For example, the Building and Construction Trades Council of Greater New York recently launched a pre-apprenticeship program that recruits workers from communities of color.

"The concern about diversity is legitimate," said Nicole Bertrán, executive vice president of The Edward J. Malloy Initiative for Construction Skills, one of several organizations coordinating the program. "That's exactly why these organizations exist."

Another initiative is the 'Community Builders Program,' funded by a grant from ABC's Illinois chapter, which teaches high-demand pre-apprenticeship construction skills and provides job placement for participants. The program recruits students of color from downtown communities and has trained 144 workers, who earn an average starting wage of $17.58 per hour.

"When they graduate after completing the 10- to 12-week course, they have basic skills and can choose a trade to specialize in," Williams said. "It's not just training; it also addresses hiring issues and integrates diversity into our membership."

The impact of systemic racism also falls on the most sensitive area for employees: pay. A 2018 study by the Illinois Economic Policy Institute found that in states without prevailing wage laws, Black workers earn $1.35 for every $1 earned by white peers (meaning Black workers earn 74 cents); in states with prevailing wage laws, Black workers earn 88 cents. Other studies also consistently show racial disparities in construction pay.

The Black plumber in Cincinnati said he has personally experienced this Black-white pay gap. "I started at this company at $11 an hour," he said. "But a white friend of mine started about a year later with the same experience, and the company gave him $14.50 an hour."

The other side of MBE special programs

Page noted that even initiatives designed to bring more minority-owned businesses into projects can sometimes backfire on them.

For example, when Page ran Hermosa Construction in Atlanta in the 2000s, he certified the company as a federal disadvantaged business and small disadvantaged business, and participated in the Small Business Administration's 8(a) Business Development Program.

Each certification is designed to help disadvantaged and minority-owned businesses access government projects, which have inclusion goals, and are often collectively referred to as minority business enterprise programs.

Such programs have real impacts on small businesses nationwide. For example, according to the Congressional Research Service, in fiscal year 2019, the federal government awarded nearly $30.4 billion in contracts to SBA 8(a) businesses.

But although these programs helped Page grow his annual revenue to nearly $30 million, he said the certification also has hidden downsides.

"When you certify a business as disadvantaged, it labels me as 'high risk' in the eyes of other stakeholders on the project," Page said, because small and minority-owned businesses typically have less capital and may face more financing challenges on long-term projects. As a result, in Page's experience, his company often ended up with the least desirable work on large projects.

"It's usually what others leave behind," Page said. "It's never the critical trade. It's usually just grading, some rough carpentry, or pushing subcontractors to bring your people into the project in some way."

This push sometimes breeds resentment among other subcontractors on the project, Page said.

"I show up on the job site, and I have the certification, and the attitude of others is: I only got in because of the certification," Page said. "So even if you have the world's best carpenter, you're initially viewed as a lower-tier contractor."

Getting the project, but not the capital

For Delbert Jordan, president of Pro Construction, a road construction company based in Richmond Heights, Ohio, securing enough financing to push his company toward larger projects is also a challenge, despite his MBE certification.

"You can get the project opportunities, but you can't get the capital," said Jordan, who is Black.

In fact, according to the SBA's Office of Advocacy, "minority-owned businesses tend to be smaller, less profitable, and have lower survival rates than non-minority counterparts. Part of these differences is due to credit availability."

Williams said MBE certification sometimes brings another issue after a project is completed.

"As soon as the project ends, the first one laid off is that Black or Hispanic person," he said. "I've seen contractors do this. So it doesn't really solve the problem."

Instead, Williams said, companies should make genuine efforts to bring workers of color into long-term positions.

"If you're really trying to fight racism, then you need to consciously look for qualified workers of color and bring them into your team," Williams said.

For these reasons, both Jordan and Page have stopped taking on projects under MBE certification. "Being certified as a minority-owned business is not what people think," Jordan said. "It's definitely not an easy path."

Addressing the barriers

Many construction companies strive to include minority-owned businesses in projects and recognize the challenges they face. For example, Clark Construction, based in Bethesda, Maryland, and its affiliate Edgemoor Infrastructure & Real Estate, set a goal of 20% MBE participation on the $1.5 billion Kansas City International Airport terminal project.

To achieve this goal, the partners developed programs to support MBE firms, including a low-interest loan program, equipment rental program, and prompt payment program.

"Through these programs, we are investing in the potential of small businesses," said Mark Goodwin, vice president of Clark Construction and lead contractor for Clark | Weitz | Clarkson, the joint venture designing and building the new terminal. "We will continue to find ways to engage minority- and women-owned businesses in meaningful ways in construction."

Although such efforts show progress is being made, those interviewed for this series said there is still much work to be done to eliminate the negative effects of deeply entrenched discrimination.

"These kinds of systemic challenges cannot be solved with a one-time approach," Williams said. "You have to integrate this goal into every fiber of your company."