Chicago faces union work rule dilemma

Thomas Lifson
Barack Obama's home town is hemorrhaging jobs thanks to union work rules and outlandish pay scales, and even government officials are concerned. Conventions used to be a big business in Chicago, but absurd union pay scales and work rules have been steadily driving major conventions to cities with no such union problems, especially Las Vegas and Orlando. This has created a dilemma for the government entity, the Metropolitan Pier and Exposition Authority, run by the city and state.

Yesterday, a 16-member Illinois State Senate-House committee was looking into how to save McCormick Place, the vast convention facility in Chicago, and the city and state economies, from ruination at the hands of greedy unions. The Chicago Tribune editorialized:

What was different and refreshing Thursday was a sense of urgency that punctuated testimony over three hours at the packed-to-capacity hearing run by Senate President John Cullerton, D-Chicago.

Five organizations testified: the National Restaurant Association, American College of Surgeons, International Housewares Association, Society of Manufacturing Engineers and Graphics Arts Show Co. Their shows brought nearly $300 million worth of economic activity to Chicago last year.

The Trib cited some of the uncompetitive practices foisted upon unlucky conventions by the avarice of unions:

  • Contracting for electrical service at Orlando's convention facilities costs 40 percent less than in Chicago, said Mary Pat Heftman of the restaurant association: "I can't explain that 40 percent differential to my exhibitors. Exhibitors in other cities can drive up to the dock and unload equipment themselves. Not in Chicago."
  • Setting up a stage for an opening ceremony (with black drape, logos, flags, lighting, etc.) costs $46,000 in Chicago - and $32,000 in San Francisco, said Felix Niespodziewanski of the College of Surgeons. Organizers have to deal with a bewildering array of unions with different minimum rates, overtime rules, break times, etc.
  • Chris Price of the Graphic Arts Show Co. said the quality of work at McCormick Place is top-notch, but the work rules make it uncompetitive. Example: 100 Chicago laborers are being flown to Orlando to help set up the plastics show there. "They will be put up in hotels, fed, and all the rest, and it's still cheaper to do business there than here," he said.
  • Setting up an ice machine in Orlando costs $720. Setting one up in Chicago costs $1,700, said Eric Holm of Manitowoc Foodservice. Ordering power for the company's booth in Orlando costs $9,200. Chicago? $12,800, plus $5,000 for labor. The cost for 24-hour service for one refrigerator is $48 in Orlando, $400 in Chicago.

The hearing yesterday was the very same day that California's last auto assembly plant, the NUMMI facility, closed its doors, ending thousands of union jobs. Toyota, which was stuck with the unionized (UAW) facility when joint venture partner GM pulled out, opted to concentrate production at nonunion facilities.
Barack Obama's home town is hemorrhaging jobs thanks to union work rules and outlandish pay scales, and even government officials are concerned. Conventions used to be a big business in Chicago, but absurd union pay scales and work rules have been steadily driving major conventions to cities with no such union problems, especially Las Vegas and Orlando. This has created a dilemma for the government entity, the Metropolitan Pier and Exposition Authority, run by the city and state.

Yesterday, a 16-member Illinois State Senate-House committee was looking into how to save McCormick Place, the vast convention facility in Chicago, and the city and state economies, from ruination at the hands of greedy unions. The Chicago Tribune editorialized:

What was different and refreshing Thursday was a sense of urgency that punctuated testimony over three hours at the packed-to-capacity hearing run by Senate President John Cullerton, D-Chicago.

Five organizations testified: the National Restaurant Association, American College of Surgeons, International Housewares Association, Society of Manufacturing Engineers and Graphics Arts Show Co. Their shows brought nearly $300 million worth of economic activity to Chicago last year.

The Trib cited some of the uncompetitive practices foisted upon unlucky conventions by the avarice of unions:

  • Contracting for electrical service at Orlando's convention facilities costs 40 percent less than in Chicago, said Mary Pat Heftman of the restaurant association: "I can't explain that 40 percent differential to my exhibitors. Exhibitors in other cities can drive up to the dock and unload equipment themselves. Not in Chicago."
  • Setting up a stage for an opening ceremony (with black drape, logos, flags, lighting, etc.) costs $46,000 in Chicago - and $32,000 in San Francisco, said Felix Niespodziewanski of the College of Surgeons. Organizers have to deal with a bewildering array of unions with different minimum rates, overtime rules, break times, etc.
  • Chris Price of the Graphic Arts Show Co. said the quality of work at McCormick Place is top-notch, but the work rules make it uncompetitive. Example: 100 Chicago laborers are being flown to Orlando to help set up the plastics show there. "They will be put up in hotels, fed, and all the rest, and it's still cheaper to do business there than here," he said.
  • Setting up an ice machine in Orlando costs $720. Setting one up in Chicago costs $1,700, said Eric Holm of Manitowoc Foodservice. Ordering power for the company's booth in Orlando costs $9,200. Chicago? $12,800, plus $5,000 for labor. The cost for 24-hour service for one refrigerator is $48 in Orlando, $400 in Chicago.

The hearing yesterday was the very same day that California's last auto assembly plant, the NUMMI facility, closed its doors, ending thousands of union jobs. Toyota, which was stuck with the unionized (UAW) facility when joint venture partner GM pulled out, opted to concentrate production at nonunion facilities.