Safety Coalition: OSHA silica rule cost estimate off by $4.5 billion

Source: Construction Industry Safety Coalition, Washington, D.C.

The Occupational Safety and Health Administration’s proposed standards covering respirable crystalline silica will cost contractors and their suppliers $5 billion per year—nearly $4.5 billion above estimates agency officials indicated in September 2013, when they outlined a new permissible exposure limit (PEL) for construction and general industry workplaces.

The Construction Industry Safety Coalition (CISC) quantifies the shortfall in “Costs to the Construction Industry and Job Impacts from OSHA’s Proposed Occupational Exposure Standards for Crystalline Silica,” a report prepared for members and submitted March 25 to Assistant Secretary of Labor Dr. David Michaels.

“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,” says National Association of Home Builders Chairman Tom Woods. “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.”

“[It] clearly demonstrates OSHA’s lack of real world understanding of the construction industry and raises serious questions about their ability to responsibly craft industry standards,” notes Associated Builders & Contractors Vice President of Government Affairs Geoff Burr. “We hope this report will lead OSHA to work more closely with the construction industry to emphasize compliance with the current [crystalline silica PEL] standard.”

In the event OSHA adopts the PEL set in the proposed rule, report authors estimate that about 80 percent of the cost, or $3.9 billion/year, will be direct compliance expenditures by the industry such as additional equipment, labor and record-keeping costs. The remaining 20 percent, or $1.05 billion/year, will come in the form of increased prices for construction materials and building products. CISC contends that the agency failed to factor additional costs tied to proposed standard, which stakeholders will then pass on to customers in the form of higher prices.

“These errors raise serious and significant questions about many of the other assumptions the agency relied upon in crafting its new rule,” observes Associated General Contractors of America CEO Stephen Sandherr. “We need measures in place that are going to allow all of us to continue the significant improvements in silica safety the industry has made, and the sad truth is that the agency’s rule is too riddled with errors to do that.”

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 positions, 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.

CISC is comprised of 25 trade associations representing virtually every aspect of the construction industry, from home building, to commercial and road construction, to heavy industrial production, to specialty trade contractors and material suppliers. Along with NAHB, ABC and AGC, members include American Society for Concrete Contractors, Interlocking Concrete Pavement Institute and Mason Contractors Association of America. The full CISC report and letter to OSHA chief Dr. Michaels are posted here. 

Related articles
Industry tackles incendiary silica rule
Industry representatives step to podium at OSHA silica rule hearings
Contractor coalition, Chamber: OSHA silica rule unworkable, economically infeasible
Economist contrasts concrete pipe profitability with OSHA’s silica rule claims