Texas Contractors Say Playing By The Rules Doesn't Pay

Homes in Texas are cheap — at least compared with much of the country. You can buy a brand new, five-bedroom, 3,000-square-foot house near Fort Worth for just $160,000.

But that affordability comes at a price — to workers, many of whom are in the country illegally and make $12 an hour or less, but also to business owners.

Let's say you own a big Texas construction firm, and you want to run your business the right way. You try your darndest to hire only legal workers and pay them a decent salary plus benefits.

Most importantly you pay all your taxes, Social Security, unemployment — everything you're supposed to — just like a normal company in other industries.

So, how's that working out?

"There's no way you can compete," says Stan Marek, CEO of the Marek Family of Companies, one of the largest commercial interior contractors in Texas. They've been in business 75 years, but Marek says the past four have been extremely difficult.

"When someone is paying less per hour, no workman's comp, no payroll taxes, [no] unemployment — we can't overcome that," he says.

At Baylor College of Medicine in Houston, Marek's workers are building the interior for the hospital's newest wing. Workers ride around on what are called "motorized man lifts," which allow them to work high in the air, power tools in hand.

Baylor Hospital is the kind of client that hires Marek's companies — an owner that must have its building done to exacting specifications. But these days, Marek says, that's unusual. The main thing most clients care about, he says, is how cheaply the job can be done.

That's where the subcontractors — and "independent contractors" — come in.

"It's very common in our industry for hourly guys to do the framing, which is putting up the middle studs, and then hiring a sub-crew to come in and do the Sheetrock, and then hiring a different sub-crew to come in and do the taping and floating," Marek explains. "And a different sub-crew to come in and do the grid for the ceiling. And a different crew to put in the tile. That's very common."

And that's how an estimated half-million undocumented, mostly Hispanic construction workers go to work each day in Texas. Marek says in the 1940s, '50s, '60s and '70s, his uncle, John Marek, who started the company, paid union wages, and his workers lived stable, middle-class lives.

Read the entire article at NPR.org.