How will Trump's 'Buy American, Hire American' executive order impact construction?

Article written by Kim Slowey, ConstructionDive, April 25, 2017

In the latest of a series of executive orders signed since his inauguration, President Donald Trump has again chosen that method as a way to affect policy in the U.S. Unlike some other executive orders that aim to streamline project schedules and cut red tape, however, the "Buy American and Hire American" measure could put more restrictions on the construction industry.

Inside the executive order

The executive order doesn’t change anything just yet. Through the order, Trump calls on all of his administration’s agency heads to:

  • Evaluate the implementation and compliance of existing Buy America laws under their jurisdictions
  • Take a look at their waiver process and determine how it is affecting American business.
  • Come up with additional policies, within the confines of existing law, that "maximize" the use of American-made products and their components, including common construction materials like steel, iron, aluminum and cement.
  • For purposes of the order, administration officials added that American-made steel means that it is produced in the U.S. from the melting phase forward.

In addition, the existing Buy America rules require that at least 51% of a product's components be made in the U.S. The product must also be "substantially transformed" by American labor in some way. The exception is surface transportation projects, as components for products used in those types of projects must be 100% made in the U.S.

Agency chiefs have 150 days to perform this review, and the Secretary of Commerce has 70 days after that point to submit a report to the president with recommendations. The order also directs various federal agencies to review the current H-1B program and decide if anything needs to be tweaked in favor of American workers.

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