I agree, and I suspect the union problem is a symptom of the rigid procurement rules. Only a few contractors know how to navigate the system, and so the market is not really "contestable." Even though it's the private sector, unions retain bargaining power.

Also, with major urban projects there's usually political pressure from the local community to use local union labor. That might make it into contracts even if it's not a locally managed project. Again, the underlying problem is not unions, but excessive localism.