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Independent Merit Shop Elevator Contractors Rise Above the Competition

Like most subcontractors, the amount of work elevator contractors have in their backlogs directly relates to the amount of work general contractors and architects have on the books. Though backlogs haven’t returned to 2005 levels, contractors such as Kencor Elevator Systems, West Chester, Pa., Delaware Elevator, Inc., Salisbury, Md., and Country Home Elevator and Stair Lift, based near Springfield, Mo., are seeing an increase in work, especially in churches, schools and museums.

Their experience correlates to Associated Builders and Contractors’ (ABC) Construction Backlog Indicator (CBI), which rose 3.9 percent during the second quarter of 2013 and remained at 8.2 months during the third quarter. The gradual uptick is creating a new challenge for contractors: hiring workers capable of retaining the broad amount of trade knowledge necessary for working in the elevator industry.

“We’re one of the few trades that needs to know about all disciplines because we get asked to do things that need to be connected to drywall, sheet rock, hoisting, beams, and electrical and plumbing work,” says Rick Kennedy, CEO and president of Kencor Elevator Systems. “It takes a broader-skilled mechanic to do this work.”

Constant innovation in technology makes the industry even more complex. With improvements in computerized controls, remote dispatching, visual displays, dispatch and voice recognition, contractors must make sure their employees are at the top of their game to remain competitive.

But formal training for elevator contractors is relatively new. Until the unions created a training program in the late 1960s, all training was passed down from mechanic to apprentice. Because merit shop contractors did not have access to union training, they relied on the mentor method until the National Association of Elevator Contractors (NAEC) created the Certified Elevator Technician (CET) program in 2001. The CET program, approved by the Department of Labor as a certified apprenticeship program, takes four years to complete and includes on-the-job, classroom and online training, as well as interactive and practical training sessions.

Now the challenge is attracting qualified people to the industry. “It’s a constant battle because it takes four years to turn an apprentice into a mechanic. We can’t let apprentices work unsupervised until they are fully certified, so we need to keep a constant flow of young people in apprenticeships,” says Pete Meeks, owner and president of Delaware Elevator. “We look at work ethic and attitude more than anything because we can train the rest.”

Meeks, Kennedy and Craig Jones—owner of Country Home Elevator and Stair Lift—recruit employees from vocational
schools, community colleges and the military. But today’s changing workforce demographics make recruiting more challenging than ever.

“Hiring a quality person or technician has become a very difficult task,” Jones says. “The level of basic knowledge I get from a high school or two-year college student is not what I would get from a person five to 10 years ago. There’s a real lack of basic education.”

Kencor Elevator Systems is proactive in finding the most qualified workers. “You have to think outside the box to stimulate and grow organically. You can sit and wait for people to walk in the front door or you can create a program and an atmosphere for it,” Kennedy says.

Five years ago, local junior colleges approved a program that allows Kencor Elevator Systems employees’ apprenticeships to count as college credit toward an associate degree. The company pays for half of its employees’ education.

“Workers can go to school and see the direct benefit of what they are learning. The glass ceiling is broken for a lot of these people,” Kennedy says. “It creates energy in the workforce; everyone’s starting to get involved.”

Competition
Elevator contractors are classified in four ways: smaller independent firms and major manufacturers, such as Hitachi and Otis Elevator Company, as well as union and nonunion.

“The four major elevator companies are like the Walmarts of the industry,” Meeks says. “But there are a lot of independent merit shop companies, and we get work because we tend to cater to customer service and being flexible for contractors.”

As an independent contractor, Country Home Elevator and Stair Lift is better able to concentrate on maintaining relationships with the architect, contractor and owner.

“This is especially true for the general contractors we work with,” Jones says. “They know we’re there to help them spec and bid the job. We understand the logistics of working with general contractors.

“Everything we do hinges around understanding how a building is built,” he adds. “Architects can spec everything, but they may not know all the details about how the elevators are installed. So we have to be able to communicate that to the jobsite supervisor so all the other trades know where the walls align and anchor points go.”

Kencor Elevator Systems, Delaware Elevator, and Country Home Elevator and Stair Lift also have found a niche in providing non-proprietary products.

“It’s so competitive in the new construction arena and major manufacturers are putting in highly proprietary systems that do not deploy the level of quality we are accustomed to as an industry,” Meeks says. “The elevators they install are somewhat disposable and don’t have the same lifespan as ours. We use higher quality U.S.-manufactured equipment.”

Non-proprietary equipment also allows customers to get competitive maintenance bids because they don’t have to deal with systems that require special tools or software. “We keep service and maintenance contracts based on the quality of service we provide, not because we hold customers hostage,” Meeks says.

Kencor Elevator Systems maintains nearly 2,000 elevators and won the contracts for those systems competitively, not through installing proprietary products. It also does elevator modernization, which requires contractors to be able to work on a variety of elevators in many different facilities, including residential structures, hospitals, multifamily units, schools and churches.

Delaware Elevator does modernization as well, along with new installations, retrofitting, and service, repair and maintenance. It also has a marine division that works on ship elevators and offshore platforms, a residential division that does custom
installations and a manufacturing division.

“We manufacture and engineer just about every elevator we install,” Meeks says. “If we don’t manufacture a part, we outsource it to a quality U.S.-based manufacturer, unlike the big elevator companies.” Nearly half of Delaware Elevator’s work is for state and federal governments, which require the use of American products.


Jessica Porter is staff writer of Construction Executive. For more information, email porter@abc.org, visit www.constructionexec.com or follow @ConstructionMag.



Merit Shop Elevator Contractors Band Together to Protect Businesses and Workers
By Andy Conlin

In 2008, seven members of Associated Builders and Contractors (ABC) troubled by threats to the merit shop business model in the elevator construction and maintenance sector banded together to form the ABC Elevator Contractors Council (ECC). The group was concerned about contractor and mechanic licensing legislation and regulations proposed at the state and local levels that would discriminate against merit shop contractors and their workers. Additionally, the members wanted to raise the profile of merit shop elevator contractors in the construction industry.

In 2010, the ECC decided to form a separate association—the Merit Shop Elevator Contractors Association of America (MECAA)—to defend the interests of merit shop elevator contractors. MECAA grew to approximately 45 members and actively engaged leaders in a number of states to advocate on behalf of merit shop elevator contractors.

Among MECAA’s success stories is its effort to amend a discriminatory statute in West Virginia, which stands out as an example of how ABC and MECAA collaborated to achieve successful public policy outcomes. West Virginia adopted a requirement that made it nearly impossible for merit shop accessibility contractors and the private home lift community to secure mechanic licenses for themselves and their skilled craft professionals. MECAA representatives partnered with ABC West Virginia Chapter staff and member companies to educate lawmakers about the negative impact of the new law on small business owners throughout the state. As a result, the state legislature adopted a law in 2012 that created opportunities for contractors to secure licenses for themselves and qualified workers.

In 2012, MECAA’s key members started to examine their organization to determine its future. The organization was staffed on a volunteer basis, with members donating staff to fulfill MECAA’s key functions. By mid-year, MECAA and ABC leaders began forming an agreement that would enhance the fight against discriminatory elevator contractor and mechanic licensing requirements and allow merit shop elevator contractors to expand their visibility in the construction industry.

In January 2013, MECAA officially rejoined ABC as the Elevator Contractors Council. The ECC is still working to ensure that state licensing requirements allow all qualified elevator contractors to obtain licensure. In 2013, the ECC actively influenced legislation and regulations in eight states and monitored proposals in more than 20 others.

Learn more about the ECC at www.abc.org/elevators.


Andy Conlin is senior manager of state and local affairs for Associated Builders and Contractors. For more information, email conlin@abc.org.