Full Citation
Title: The Economic, Fiscal, and Social Impacts of State Prevailing Wage Laws: Choosing Between the High Road and the Low Road in the Construction Industry
Citation Type: Miscellaneous
Publication Year: 2016
ISBN:
ISSN:
DOI:
NSFID:
PMCID:
PMID:
Abstract: Opponents of prevailing wage laws claim that repealing or weakening the wage policy will save taxpayer dollars, yet 75% of recent peer-reviewed studies indicate that construction costs are not affected by prevailing wages. However, the absence of prevailing wages increases taxpayer burdens by increasing the likelihood that construction workers will earn incomes below the poverty level, become more dependent on public assistance, and will not have health insurance and retirement benefits. Furthermore, prevailing wages perform an important economic development function by reducing the leakage of construction funds, jobs, income, and spending from the local economy. Weakening or repealing prevailing wages does not reduce construction costs, but increases poverty and decreases economic activity. In fact, weakening or repealing state-level prevailing wage laws in the 25 states that currently have strong or average wage policies would have negative economic, fiscal, and social impacts on the U.S. economy. This study is a data-driven examination of prevailing wage laws with the economic impacts and statistical analysis of construction worker labor market outcomes based on information from the U.S. Census Bureau (the Current Population Survey, American Community Survey, and the Economic Census of Construction) and the National Health Expenditures Survey. The economic impact results are obtained from IMPLAN, an input-output model that is based on data from the U.S. Bureau of Economic Analysis. All of the quantitative analyses presented in this report are reproducible. The review of the research on prevailing wages and construction costs distinguishes between those studies that were peer reviewed and those studies that were not examined by experts prior to publication.
Url: https://michiganprevails.com/wp-content/uploads/2015/02/PW-national-impact-study-FINAL2.9.16.pdf
User Submitted?: No
Authors: Manzo IV, Frank; Lantsberg, Alex; Duncan, Kevin
Publisher: Illinois Economic Policy Institute
Data Collections: IPUMS CPS
Topics: Labor Force and Occupational Structure, Other
Countries: United States