Now is a great time to review the principles you believe and follow in employee engagement. While each company will determine their own set of unique employee engagement principles, there are a number of key ones you must look to first.

According to a new report from the Associated General Contractors of America, construction employment expanded in 29 states during September and October of 2011. During their analysis of state employment data, released recently by the Labor Department, the AGCA found that while construction employment in 29 states increased, fewer people are working in construction compared to last year’s 39 states.

After the data was released Ken Simonson, Chief Economist with the Association, stated that construction employment still remains volatile while the construction industry remains fragile. While he assured that the construction industry was no longer “in free-fall” Simonson said the construction industry had a long way to go as improvements varied from state to state and project to project.

The data collected showed that Arizona (4.4 percent, 5,000 jobs) experienced the largest one-month seasonally adjusted percentage increase and Texas (2.3 percent, 8,800 jobs) the largest one-month total increase in construction employment between September and October. Other states adding large numbers of construction jobs during October included Illinois (1.5 percent, 3,000 jobs); Washington (2.1 percent, 3,000 jobs); South Carolina (3.2 percent, 2,500 jobs); and Colorado (1.6 percent, 1,800 jobs).

Simonson noted 20 states plus the District of Columbia lost construction jobs during the past month, while construction employment remained unchanged in Rhode Island. Minnesota (-2.7 percent, -2,300 jobs) lost the highest percent of construction jobs for the month while Florida lost the most jobs (-2.4 percent, -8,600 jobs). Among other states losing construction jobs between September and October were Pennsylvania (-1.0 percent, -2,200 jobs); Maryland (-1.3 percent, -1,900 jobs); Georgia (-1.2 percent, -1,800 jobs); and Massachusetts (-1.4 percent, -1,500 jobs).

Eleven states and D.C. added construction jobs for the year, Simonson added. The largest year-over-year percentage increase was in Kansas, where construction employment rose 9.0 percent (5,100 jobs), followed by Oklahoma (8.1 percent, 5,400 jobs); Arkansas (5.1 percent, 2,600 jobs); D.C. (4.6 percent, 500 jobs); and West Virginia (3.3 percent, 1,100 jobs).

Among the 39 states that lost construction jobs over the past twelve months, Nevada experienced the largest percentage decline (-19.5 percent, -14,500) while California lost the most jobs (-45,700, -7.9 percent). Other states experiencing large declines for the year include Idaho (-15.2 percent, -5,000 jobs); Vermont (-13.4 percent, -1,800 jobs); Montana (-10.5 percent, -2,500 jobs); and Missouri (-10.3 percent, -11,900 jobs).

The two most problematic areas for construction experts to successfully manage are contractual risks and the insurability of projects. Contract reviews and insurance facilitation are critical components in an effective risk management program. Insurance facilitation assumes the likelihood that accidents will occur and seeks an efficient way of distributing and/or transferring the risk.

In many cases the loss is transferred to the insurer, using conventional insurance as the risk transfer method. In other instances, the use of contractual risk transfer methods, utilizing indemnification provisions, are used. However, in most cases, the combination of insurance, risk financing, and contract indemnification provisions are used.
 

With any construction project comes a set of risks. For example, gambling on a contractor whose level of commitment or qualification is uncertain or who could become bankrupt halfway through the construction process can be a costly decision. The Surety Bond is a credit instrument that guarantees the contractual obligations between the contractor and the owner. Surety Bond credit can be very risky to provide, as a result, it is important that a trusted relationship is built and maintained between the Contractor, the Surety Bond Agent and the Surety Company.

Construction Assurance and Surety Bonds

Surety bonds provide financial security and construction assurance by giving project owners the confidence that contractors will perform the work and pay specified subcontractors, laborers, and material suppliers. A surety bond is a risk transfer mechanism where the surety company assures the project owner (obligee) that the contractor (principal) will perform a contract in accordance with the contract documents.

Obtaining Surety Bonds for Construction Projects

Any reputable Surety Bond company will have to establish your credit-worthiness to the Surety Company before a bond can be issued. While different Surety Bond agents will look for different items before obtaining your Surety Bond, some items providers may require can include:

1. A history of your company, work history, organizational chart, and key-employee resumes.

2. A Corporate or Strategic Plan detailing current and future 1-3 year company plans and objectives. This plan should include information about the Buy-Sell and Continuity Plan of the construction company which will provide the Surety an understanding the future management team.

3. Financial statements from the past three year ends prepared by a certified public accountant, or acceptable alternative along with the most current in-house financial information.

4. Work on Hand information for the past three year ends and a current in-house work on hand.

5. Bank Relationships and Credit References.

While these differ from company to company, it gives you a general understanding of what is needed before obtaining a Surety Bond for any construction project.

RENEE KUHS
Compliance Attorney, HNI

RENEE KUHS & JODI MATHY
Compliance Attorney & Post Loss Specialist, HNI

Mistakes are measured in time and dollars. Makes sure you avoid these 10 mistakes when handling worker's compensation claims.