President Biden scored a major win when he signed his Infrastructure Investment and Jobs Act into law on November 15. But it was also a win for payroll sales representatives who are looking to land big deals with construction companies in 2022.
The new law will create millions of new jobs for government contractors, who will suddenly be faced with new payroll challenges and complexities. And the influx of government money will open up greater spending opportunities that HCM sales reps can use to solve those payroll problems.
Let’s take a look at what the Infrastructure Investment and Jobs Act means for you as a payroll sales representative.
Related reading: Biden’s Huge Infrastructure Bill Could Mean Huge Deals for HCMs
What’s in the Infrastructure Investment and Jobs Act?
The Infrastructure Investment and Jobs Act will create 1.5 million jobs, giving the construction industry new opportunities like never before.
The new infrastructure act is dedicated to building new, expanding on, and repairing the nation’s physical infrastructure. It will disburse $1.1 trillion in physical infrastructure investments, ranging from roads and bridges to ports and airports to underground water systems, broadband, power and electrical grids — nearly every kind of infrastructure you can think of.
The plan will also put $65 billion into expanding broadband — something that’s suddenly become a major priority sincer the coronavirus pandemic sent millions of Americans to work from home without adequate internet access.
The size and scope of the act promises to put contractors to work for years.
New Opportunities for Payroll Companies
There are two major implications for contractors that should be on your radar.
First, because the projects will be government funded, companies will need to be in compliance with government contract regulations. That means paying the correct prevailing wage and fringe wages, and providing Certified Payroll reports to prove compliance.
Many companies will be contracting with the government for the first time, and will be wading into unfamiliar — and deep — waters. For others, they’ll be adding to their payroll, which means increasing the complexity (and time investment) of their manual payroll calculations.
Second, unions are going to play a major role in the infrastructure contracts. In 2019, there were just over 1 million union members in construction. The best forecasts say these new infrastructure projects will require two to three times that number of union workers — and possibly even five times as much. In any case, it’s certain that your construction customers need to be ready for unprecedented numbers of new unionized workers.
Both of those implications create new opportunities to help you close deals in 2022.
Now Is the Time to Talk About the Infrastructure Investment and Jobs Act
Funding will go out over a five-year period, but experts expect that it could take up to a year or more for many of the major projects to start. Even so, now is the time for payroll sales representatives to act. Government contractors are making strategic decisions now, and you’ll need to claim a seat at the table while you can.
Start the conversation with some questions that prompt your prospects to think about how their payroll situations will change.
- Have they talked to legal counsel if they’re planning to go after this business? Employers will need to understand the union implications and have a plan for dealing with new union regulations.
- Do they have the compliance systems in place to report to the government? Government contractors are required to submit certified payroll reports, which require complex calculations and toilsome form-filling. For employers that don't get certified payroll working right, the consequences can be paralyzing.
- Are they prepared for the additional workload of new and more complex payroll calculations? Find out how much of their payroll processes are handled manually and explore ways to help them automate.
There may be no industry that needs to outsource payroll more than construction. There may also be no industry that's more difficult for a sales rep to close. That's because construction companies have to deal with unique complexities that most people don't understand. So, while Biden’s infrastructure act creates new opportunities for payroll companies, you still have your work cut out for you.
Fortunately, you have a partner who knows the construction industry inside and out.
Related reading: Keys to Winning Construction Clients When You're New to the Industry
IDI Can Help
When you partner with IDI, you have a solution that other payroll providers can’t match. We’ve been steeped in the industry for over 30 years, and we have the expertise to help you navigate all the tricky spots—from qualification to implementation.
We also supplement your payroll system with contractor-specific solutions that your competitors can’t provide. Our Contractor Central platform holistically addresses the key components that have prevented construction companies from successfully outsourcing their payroll needs.
Contractor Central was built to handle the complexities of processing construction paychecks, and getting them right every time. By bringing in Contractor Central, you can provide a solution your competitors don’t offer:
- Prevailing and union wages based on multiple variables
- Fringe rates associated with the prevailing wage rate
- ERP integration to job cost level
- Certified payroll reporting
If you’re going after new construction clients, be sure to engage with us early on in the process. Implementation takes time, and the earlier IDI is a part of the discussion, the more successful your engagement will be.