Salem, OR – In December 2024, Oregon Governor Tina Kotek issued an executive order that has sparked significant debate across the state. The order, aimed at increasing union participation in state-funded highway projects, has been criticized for potentially raising project costs, limiting competition in the bidding process, and benefitting a select group of workers—many of whom are strong supporters of Kotek.
The executive order requires contractors working on certain highway projects to prioritize unionized labor. The move, which aligns with Kotek’s long-standing support for organized labor, has been hailed by unions as a victory. However, critics argue that it could have negative consequences for taxpayers and the broader Oregon workforce.
Concerns Over Increased Costs
One of the primary concerns raised by critics of the executive order is that it will drive up the cost of highway projects. By limiting competition to unionized contractors, the order may reduce the number of eligible bidders, as non-union contractors could be excluded from consideration. This reduction in bidding competition typically leads to higher prices, as fewer contractors would be competing for the job.
An analysis from the Oregon Department of Transportation (ODOT) suggests that unionized contractors may charge higher rates due to labor agreements and wage standards that are often above the market average. While union labor provides workers with certain benefits, critics argue that these higher labor costs will ultimately be passed on to taxpayers, resulting in more expensive projects.
Reduced Competition and Limited Options
Another key issue raised by the order is the potential reduction in competition. When fewer contractors are eligible to bid on projects, the state may lose out on the competitive pricing that can be a crucial factor in keeping costs low. Smaller, non-union contractors, who may offer more competitive rates, could be sidelined by the new policy.
For many in the construction industry, the executive order represents a shift away from the open market and free competition. Small business owners, particularly those who operate non-union shops, have expressed concern that they will be shut out of bidding opportunities. This could lead to a concentration of work among a limited number of union contractors, further restricting the pool of options available to the state and taxpayers.
Union Influence and Political Allegiances
The executive order has also sparked accusations of political favoritism. Governor Kotek, who has long been a strong supporter of unions, is seen by critics as using this policy to reward her political allies in the labor movement. Unions have been key supporters of her political career, and the executive order is widely viewed as a gesture of goodwill toward those who helped her secure office.
While Kotek’s supporters argue that unions provide fair wages and important protections for workers, others see the order as a politically motivated move that benefits only a small portion of the workforce. The executive order could be viewed as an example of government intervention that, while well-intentioned, creates an imbalance in the market and places additional burdens on taxpayers and non-union workers.
ODOT’s Analysis and Contradictions
An analysis conducted by the Oregon Department of Transportation (ODOT) further complicates the debate. The report, which was issued before the executive order was signed, raised concerns about the potential for increased costs and limited competition in the state’s construction industry. ODOT’s analysis warned that increasing union labor requirements could lead to higher overall project costs, especially if fewer contractors are eligible to participate.
The fact that Kotek proceeded with the order despite her agency’s own findings has raised eyebrows. Critics argue that the governor is disregarding expert analysis in favor of a policy that serves the interests of a powerful political constituency. This contradiction has sparked further controversy, with some questioning whether the decision was made for political reasons rather than based on sound economic policy.
A Divisive Policy with Long-Term Implications
Governor Kotek’s executive order represents a significant shift in how the state approaches public works projects. While it aligns with her commitment to labor unions and their role in ensuring fair wages and benefits, the order has raised concerns about its broader impact on taxpayers, competition, and the construction industry in Oregon.
As the policy moves forward, it will likely face continued scrutiny from lawmakers, industry groups, and the public. Whether the long-term benefits of supporting unions outweigh the potential drawbacks remains to be seen, but one thing is clear: the executive order has ignited a heated debate that will likely continue to shape Oregon’s infrastructure policy for years to come.
