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Who are those guys? Part 3

Date Posted: October 11 2002

(Last in a series of three articles examining the membership roster of the Associated Builders and Contractors, a group established in 1950 to counteract the goals of construction unions in the courtrooms, legislatively and on the nation's job sites.)

"There are a lot of smoke and mirrors coming from the ABC, and the truth is, they do have an effective spin machine. But with the exception of organized labor, no one ever challenges them. When we took the trouble to go through their membership directory, we saw how few contractors they really represent. The numbers are startling. The ABC doesn't have as many construction industry members as they claim, and it's an association of basically small contractors. The intent of this report was to show the rest of the industry just how small they are."

-Raymond J. Poupore, executive director, National Heavy & Highway Alliance, in an interview with The Building Tradesman. The Alliance is the umbrella organization for the major construction craft unions that build the nation's highways, bridges and mass transit projects. The final excerpt of their study follows.

The ABC national directory: a review.

The ABC classifies its members into four categories: General Contractors, Subcontractors, Suppliers and Associate Members. In this section we'll deal with the latter two categories. Suppliers represent such non-builders as equipment rental companies, concrete suppliers, paint stores, nurseries, oil companies, etc. Associate Members can represent almost anything. When you add the two categories together you get 9,160 members, or 45% of the entire ABC membership that are non-builders.

In the past two membership breakdowns we've conducted (1985 and 1994) we were always amazed at the large number of Associate Members; i.e., members like gas stations and restaurants. In 1985 our study revealed that 13% of the ABC's membership were Associate Members. In 2000 that figure has risen to 21%.

Our question is why would a restaurant like the House of Chong in Sarasota, Florida, be a member of a building construction association? When we contacted the House of Chong and asked them why it was a member of the ABC, we were informed that representatives of the local ABC chapter meet there for lunch occasionally. Oh. We suppose that's reason enough to join a building contractors association. After all, money does talk! (Note: The House of Chong may still be serving lunch and dinner but it is no longer an ABC member).

The facts have never stopped the ABC from claiming to represent this and claiming to build that. Why should they? Our studies and subsequent reports on its membership in 1985 and again in 1994 certainly didn't stop the ABC from exaggerating, just look at what it claims today.

Where are those guys?

Approximately one-third (30%) of ABC members are located in only seven southern states. These states are Alabama, Florida, Georgia, Louisiana, Mississippi, Tennessee and Texas.

When you toss-in Arkansas, Virginia and the Carolinas that percentage rises to 35 percent.

We divided the country into four geographical regions in regards to the percentage of ABC membership, with the following results: East - 22%, South - 35%, Midwest - 28%, West - 15%

We realize that the above doesn't mean a whole lot in the overall scheme of things, but we just thought that since we have stated that this is an in-depth analysis that we would add membership location to the mix.

Following is a breakdown of the top 10 states for ABC membership, including the number of ABC members and (the percentage of non-building members).

Pennsylvania - 1,554 (49%)

Texas - 1,510 (63%)

Maryland/D.C. - 1,320 (44%)

Florida - 1,277 (48%)

Mississippi - 1,106 (41%)

Michigan - 1,104 (34%)

Ohio - 843 (31%)

Alabama - 815 (62%)

Wisconsin - 802 (38%)

California - 748 (26%)

Membership turnover? - you bet!

We're sure everybody would agree that membership organizations lose some members every year. After all, some kind of organizational attrition occurs as a natural way of conducting business. So we asked ourselves: How about the ABC's membership, does it change over? What is its attrition rate? Does it change quickly? Let's just say it changes faster than the Florida vote count in the last presidential election!

In order to find out what the ABC's attrition rate is, we compared the ABC's membership from its 1996 Directory to its 2000 Directory. Naturally, we didn't want to spend hours and hours comparing over 15,000 companies from one Directory to the next. So, using those ABC firms in 1996 whose name started with the letter "F", we then cross-referenced them to those 2000 ABC members whose name also began with the letter "F". What did we find?

Lo and behold, we found that 42% of the 1996 ABC members whose name started with "F" were no longer ABC members in the year 2000! That 42% figure represents 234 companies that, for whatever reasons within a three-year period, decided to drop out of the ABC.

Yet, you may ask yourself, did we just pick companies that start with the letter "F" because it revealed such a large attrition rate? Come on! We picked "F" simply because it was a letter that didn't have a huge list of members under it. (After all, we didn't want to spend hours and hours trying to match 1996 members to 2000 members. Even we have our limits!) However, to show our sense of fair play, we decided to choose another letter (albeit, another one that didn't have a long list of members listed under it) in order to appease any skeptics. So we chose the letter "I" and performed the same type of comparison. Well, guess what? We found that when we cross-matched those 1996 ABC companies whose name began with "I" with those 2000 members whose name began with the same letter that 46% of those ABC members had not renewed their membership! That 46% figure represents 139 companies that decided not to renew their membership.

Now, does the ABC persuade other companies to become members in order to compensate for its staggering membership loss? Of course it does. It has to, otherwise, after 10 years or so with its attrition rate it would look pretty goofy with a membership of only 33 or 28 companies. Especially when you consider the fact-less rhetoric it continually espouses about how much work ABC "builders" perform. But one question remains: How long will those new members, which it must constantly recruit in order to balance out its attrition rate, stay with the ABC? Your guess is as good as ours.

However, one thing is clear, you can refer to the ABC membership as a lot of things, but "stable" sure isn't one of them!

Conclusion. Simply by reviewing and analyzing the ABC's own membership directory we have proven conclusively that the ABC is not what it claims to be. Fact: Even though its own name implies that it is a building construction association, almost one-half (45%) of its members are non-builders. Yet, it continues to represent itself as "22,000 employer" members in the construction industry, even testifying to this exaggerated claim before various Congressional Committees on Capitol Hill.

Fact: Its members in no way or manner perform 75% of all construction work in this country. We have proven that it is simply not possible for its "building" members to accomplish this Herculean feat. And once again, we must reiterate that the dollar volume of work performed by each member that we used to arrive at this conclusion came directly from the ABC's own publication.

Fact: In a three-year time period the ABC experienced an approximate 44% attrition rate. Did it pick-up additional members to compensate for its drop-outs? Sure it did. But the fact remains that almost one-half of its members decided to leave the ABC over a three-year period. We must ask why? What compels so many members to drop their membership?

The plain truth is that the ABC is an association of small builders. Nothing more, nothing less. Oh sure, they have some large contractors. But the truth of the matter is the ABC wants nobody to know what it really represents. Contrary to its exaggerated claims, the vast, vast majority of its 11,000 members actually involved in building something are small contractors building mostly small things. It is laughable to think that the ABC once claimed in an advertisement that its members "build America."

Nevertheless, one thing is true about the ABC. It is one heck of a public relations/spin machine. It is always quoted in various publications and/or newspaper articles commenting on one construction-related topic or another. Always. And whenever a Congressional committee needs a certain type of testimony regarding some aspect of the construction industry, up pops the ABC to testify. Sometimes it seems the ABC is everywhere, commenting on everything. Which it has every right to do.

We have no problem whatsoever with the ABC being constantly quoted or referred to in that magazine or that newspaper, or testifying on Capitol Hill, or participating at various prove any of its myriad of claims. Nobody. Well, we are…but we suppose we might be waiting a very long time for an answer which is substantiated by facts.

What we do have a problem with, however, is why won't the ABC tell the truth about who it actually represents or how much construction its members actually perform? If it's such a viable organization, why must it continually exaggerate its numbers? Why must it profess that its members build most of everything when it's obvious they do not? Why can't it simply tell the truth about who it represents? Why can't it maintain a steady and stable membership?

We challenge the ABC to either prove its constant claims or we will be forced to ask construction-related questions of some of its "building" members, who the ABC so conveniently includes in its 22,000 membership claim when it ventures to Capitol Hill or elsewhere to pontificate on the construction industry. You know, members such as Mr. Copy Service of Jacksonville, Florida, or Ads That Care of Waupon, Wisconsin, or Savoy Catering of Waynesboro, Pennsylvania, or Gulftex Vending & Coffee Service of Clute, Texas.

If the ABC cannot be factual about its own membership, then what will it be factual about?