Who is Really at Fault for Trade Show Exodus?

2/11/2010 3:00 PM

Chicago (CBS)

After taking the brunt of the blame for the big trade show exodus out of Chicago, several unions are fighting back, saying the loss of business at McCormick Place isn't their fault. And they're telling CBS 2 Chief Correspondent Jay Levine who's really making money, while they say they're being paid peanuts.

They make $37 an hour, $63 if you include benefits, which really isn't peanuts. But compared to the five-figure bill which goes to exhibitors for their hour's work, it makes you wonder who's the real villain here.

There are actually five different unions on the floor at McCormick Place this week setting up for one of the city's favorite events: The Chicago Auto Show.

Electricians, carpenters, decorators, teamsters and riggers. That's part of the problem, exhibitors say. Too many jurisdictions, too many work rules.

David Causton, the General Manager at McCormick Place says: "There are work rule changes that are necessary in order to align ourselves with our competition."

Causton's doing his best to negotiate those changes. But the fees charged by contractors who actually stage the shows are another matter.

CBS 2 obtained rate sheets from Riggers Local 136. They move exhibits from loading docks to their assigned spots on the convention floor. The fee charged by the show's contractor for that is called "drayage." And it's a whopper.

"An exhibitor can ship his machine from the Orient or from Europe to Chicago and get it to McCormick Place cheaper than he can get it from the truck to his booth," said Robert Fulton, Business Manager of Riggers Local 136.

That's hard to believe.

"We have the facts to show it," Fulton said.

Take a 40,000 pound shipment from Shanghai to Chicago. By ship to LA: $4,000. By truck to McCormick Place: $8,000. Total: $12,000.

From the loading dock to the convention floor, that's drayage: $17,000 for three riggers whose pay and benefits total $63 an hour.

"If they have to go from one end of the building to the other, it still should be under an hour," Fulton said.

So for three people who make under $200 for under an hour, they are being charged $17,000.

"There's no question there are profits in the drayage bills because that's where contractors really make their money," Causton said. "Lots of profits, there's no question."

Causton favors auditing the contractors' books to see who's making what and what savings can and should be passed along to exhibitors.

Exhibitors who are also billed $99.45 an hour, the union says, for labor which costs $63.13. That's a 57 percent markup.

CBS 2 repeatedly tried to contact the two major convention contractors staging shows at McCormick Place.

"Could not be reached," Fulton said. "It says somebody's hiding."

We're told contractors Freeman and G.E.S., who have a virtual monopoly on trade shows nationwide, simply use those huge mark-ups to cover other costs.

Still, many believe they're part of the problem. Because if shows leave, they just go with them.

David Causton believes they, like everyone else, ought to have some skin in the game.

CBS 2 Political Producer Ed Marshall contributed to this report.