Friday, March 27, 2015
Estimate one of several examples of how agency fundamentally misunderstands construction industry, raising questions about overall rule, officials say in Washington, March 26-A new report released today by the Construction Industry Safety Coalition (CISC) found that the Occupational Safety and Health Administration’s (OSHA) proposed silica standards for U.S. construction industry will cost the industry $5 billion per year roughly $4.5 billion per year more than OSHA’s estimates. The coalition cautioned that the flawed cost estimates reflect deeper flaws in the rule and urged the federal agency to reconsider its approach.
OSHA’s proposed rule, intended to drastically reduce the permissible exposure limit (PEL) of crystalline silica for the construction industry, has been underestimated by the Agency to cost the construction industry about $511 million a year. The new estimates released today by CISC estimate that the costs to the industry will actually be approximately 10 times the OSHA estimate–costing nearly $5 billion a year.
The cost and impact analysis from OSHA reflects a fundamental misunderstanding of the construction industry. The OSHA analysis included major errors and omissions that account for the large discrepancies with the CISC report. The CISC report estimates that about 80% of the cost ($3.9billion/year) will be direct compliance expenditures by the industry such as additional equipment, labor and record-keeping costs.
The remaining 20% of the cost ($1.05 billion/year) will come in the form of increased prices that the industry will have to pay for construction materials and building products such as concrete block, glass, roofing shingles and more. OSHA failed to take into account these additional costs to the construction industry that will result from the proposed standard, which will then be passed down to customers in the form of higher prices.
Not only will the proposed rule be more costly than originally estimated, but it would translate into significant job losses for the construction industry and the broader economy. The CISC estimates that the proposed regulation would reduce the number of jobs in the U.S. economy by more than 52,700 yearly. That figure includes construction industry jobs, jobs in related industries such as building material suppliers, equipment manufacturers and architects, as well as losses in non-construction sectors.
Additionally, the losses are full time employee positions. Factoring in the many part-time or seasonal jobs, that number could increase to close to 80,000 positions lost.
“We are deeply concerned about the misguided assumptions and cost and impact errors that OSHA has relied upon in creating this proposed rule that will significantly affect our industry,” said NAHB Chairman Tom Woods, a home builder from Blue Springs, Mo. “This report reveals the critical need for OSHA to withdraw its proposed rule until it can put forth a technologically and economically feasible rule that also works to improve industry workers health and safety.”