The Building Tradesman Newspaper

Friday, March 22, 2013

Labor needs new strategy to battle prevailing wage repeal

By Marty Mulcahy, Editor

LANSING – State Republican lawmakers plotting to repeal the Michigan Prevailing Wage Act aren’t letting the facts get in the way of anti-union ideology.

“When you put aside the political issues, the effects of prevailing wage repeal – what it does to the cost of construction and worker incomes and the affect it will have on construction training – the facts are very favorable to us, not that that bothers the others,” said Dr. Dale Belman, Michigan State University School of Human Resources and Labor Relations.

Belman was invited to speak on March 6 to delegates at the Michigan Building and Construction Trades Council’s 54th Legislative Conference. An academic who has performed multiple studies on prevailing wage repeal in various localities, Belman said the bottom line is simple: “prevailing wage does not increase the cost of construction.”

Belman’s input was requested to provide ammunition for delegates to counter the upcoming GOP effort to undo the Michigan Prevailing Wage Act of 1965, which more than any other law, upholds construction workers’ wages in Michigan.

In only one narrow area of the construction economy – low income housing – did Belman acknowledged that a prevailing wage law could increase costs, by six percent or so. But in every major construction sector, “there’s no evidence that it’s a cost issue for roads, bridges or school buildings,” Belman told delegates.

The Mackinac Center – a widely reported conservative think-tank – sees things otherwise. Their anti-prevailing wage stance over the years has fed the constant calls for the state law to be overturned.  Their latest estimate – it has varied over the years – is that prevailing wage repeal would save taxpayers 10-15 percent on a project’s cost.

In a January 2012 op-ed, the Mackinac Center’s Paul Kersey wrote that prevailing wage repeal could save the state $200 million. He wrote: “If there’s a field where government protection of wages is necessary, it’s probably not construction.

“By requiring contractors to conform to union pay scales, the state is effectively demanding that whenever construction companies build schools or bridges for the use of the general public, they pay their already well-compensated workforces an extra 50 percent in wages. This adds at least 10 percent to the total cost of construction, and therefore the overall cost of government.”

Belman stressed that proponents of prevailing wage repeal don’t take into account the cost savings provided by enhanced productivity of workers who are properly trained. Prevailing wage is a major factor in allowing the ongoing system of union apprenticeship training, which is a natural jobs program that is completely separate from government funding. He cited one recent example of a Gulf Coast owner frustrated because he couldn’t get properly trained workers, who reached out to the union sector.

“The public relations are very important,” Belman said. “You’re playing a defensive game on this. If you’re going to be able to challenge the Mackinac Center and the Tea Party, it’s really important to bring together an equivalent group to act as a counterweight to the Mackinac Center.”

He said with the facts on the unions’ side regarding prevailing wage and other issues, and support from “natural allies” in the world of academics at major Michigan universities, organized labor would have a much better chance of getting its voice heard in the public by starting up its own think-tank. “Then the newspapers will call you,” he said.