New study demonstrates benefits of Indiana’s Common Construction Wage Law


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News release from the Indiana AFL-CIO:

New Study Demonstrates Benefits of Indiana’s Common Construction Wage Law

INDIANAPOLIS (February 20, 2015) — As the Indiana General Assembly debates repealing Indiana’s long standing Common Construction Wage law, a new study released today highlights the positive impact it has had on Indiana’s economy, workers and communities.

Authored by University of Utah Economics Professor Dr. Peter Phillips, “Indiana’s Common Construction Wage Law: An Economic Impact Analysis” finds the following:

  • In states with common construction wage laws, workers are more productive both on public works and across the entire construction industry.
  • For repeal of the common construction wage to lead to a 15 percent to 30 percent savings, blue-collar construction workers would have to work for free.
  • In 1997, Ohio exempted its public schools from common wage requirements. Despite these changes in policy, the median square foot cost of new school construction in these adjoining states tracked together before, during and after these changes.
  • The loss of construction worker skills will lead toward lower construction worker incomes across all of Indiana construction, the loss of middle class careers in construction and efforts to fill the void with guest worker programs.
  • In states with common construction wage laws, construction worker incomes are 18 percent higher than in states without this requirement.
  • Only the joint labor-management construction apprenticeship programs invest serious money in training in Indiana. Indiana’s union contractors provide 94 percent of annual apprenticeship training expenditures, while only 6 percent of the annual investment is from nonunion apprenticeship programs.
  • This difference plays out in higher productivity on the union-side of Indiana construction with higher construction worker incomes, greater health insurance coverage and more secure retirements for Indiana construction workers.
  • Nationwide, the non-union Associated Builders and Contractors is calling for guest-worker programs and state-financed vocational training, instead of industry supported investments in workers.

“Indiana’s common wage law serves a purpose,” says Dr. Phillips. “It helps promote training and skill formation and supports middle class blue-collar families. Eliminating common wage protections will lead Indiana in the opposite direction towards the decline of apprenticeship training, the rise of low-wage, no benefit jobs, the emergence of chronic skill shortage and the call for guest worker programs to provide a fix for problems that under common wage regulations do not exist.”

In addition to the report, Dr. Philips wrote a briefing paper documenting the Indiana Union Construction Industry’s 75 percent share of the Indiana non-residential construction market for 2014, dispelling the Associated Builders and Contractors testimony in the House Committee Tuesday.

The Indiana State Building and Construction Trades Council is the independent, umbrella, labor organization representing all of Indiana’s construction unions and their members. The council represents more than 75,000 craft professionals who are members of 127 affiliated local Building Trades Unions. The executive board of the state council is comprised of elected representatives from each of the 15 affiliated international Building Trades Unions. Organized in 1910, the state council is chartered through North America’s Building Trades Unions (officially, the Building and Construction Trades Department of the AFL-CIO). Although autonomous, the state council is affiliated with the Indiana AFL-CIO.


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