New Study Refutes Anti-Union
Attacks on Prevailing Wages
July 12, 2008
The Associated Builders and Contractors and other anti-union groups spend millions of dollars to try to convince people that prevailing wage laws, like the federal Davis-Bacon Act, passed in 1931, are unfair to workers and taxpayers. They say that federal and state laws—that require contractors on public projects to pay their workers the locally prevailing wages and fringe benefits of similar projects in the area—should be repealed.
A new research paper by the Economic Policy Institute, “Prevailing Wages and Government Contracting Costs,” reviews dozens of studies of prevailing wage laws. Those studies, says EPI, refute ABC’s claim that prevailing wage laws raise the cost of government public works projects. Moreover, EPI says, the research concludes that prevailing wage laws also help to reduce occupational injuries and fatalities, increase the pool of skilled construction workers, and actually enhance state revenues.
The EPI report, by economic analyst Nooshin Mahalia, finds that research cited by the anti-union sector contains a critical flaw that makes their findings unreliable. They are based on hypothetical models which assume as a starting point that higher wages will necessarily raise contract costs, rather than testing whether, in practice, there is a relationship between wages and contract costs.
For a copy of the report, click on: http://www.epi.org/content.cfm/bp215