Fighting For
Employee And Union Rights
Fighting For
Employee And Union Rights

Seven Reasons to Support Michigan’s Prevailing Wage Law

On Behalf of | Jun 26, 2017 | Labor Law

Michigan’s Prevailing Wage law provides a minimum rate for wages and fringe benefits for construction workers on projects that the State of Michigan funds or sponsors. Currently, non-union contractors are partnering with conservative politicians to repeal Michigan’s Prevailing Wage laws by obtaining sufficient signatures to put the issue on the ballot. The professional signature gatherers will cloak the true nature of their effort in an attempt to fool you to support their effort to harm working families.

Here are seven reasons to support Prevailing Wage:


1. It prevents our tax money going to support those that pay the lowest wages rather than the most skilled, highest quality, and most efficient. State funded or sponsored construction projects that are competitively bid go to the lowest bidder. Since most other costs, like construction materials, are similar for all companies, a successful bidder is one that is able to most efficiently and skillfully perform the job while maintaining high levels of quality. Without Prevailing Wage, the main factor in the lowest bid is who pays their workers the least. Our tax dollars should not be spent to encourage low wages and low performance.

2. Prevailing Wage supports worker training and safety. Research shows that construction sites that do not utilize Prevailing Wage are less safe. Prevailing Wage ensures that the workforce is more professional and less transient, which leads to more workforce training and education. This leads to higher quality, greater safety, and a more efficient use of our tax dollars.

3. Prevailing Wage promotes the local economy. One of the main reasons that the federal Prevailing Wage law was implemented during the Great Depression is that local economies were struggling. Construction companies could bring in low wage workers from other parts of the country or immigrants at much lower than local skilled trades workers. With Prevailing Wage in effect in our State, there is less incentive to bring less skilled out-of-state workers and immigrants to the State. Therefore, the tax dollars spent on construction projects tends to stay in the communities that pay those taxes. Moreover, when Prevailing Wage is repealed more out-of-state contractors perform work in Michigan, which sucks our tax dollars out of the state.

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4. Prevailing Wage supports careers in skilled trades. Michigan’s shortage of skilled trades workers is severe problem. The State needs to support citizens deciding to enter a career in the skilled trades. Lower wages will only exacerbate the problem because wages and benefits will not be sufficient to attract workers or support Michigan businesses.

5. The Labor Movement supports Prevailing Wage. The Labor Movement can always be counted on to support the working class. Although Prevailing Wage does not directly benefit the wages and benefits of union skilled trades workers because they earn union wages and benefits, it directly benefits non-union workers who see a pay increase on prevailing wage jobs. It indirectly benefits unionized workers on these jobs because they can compete on the basis of their skill and ability rather who is willing to work for the lowest wage. That is why the Labor Movement supports Prevailing Wage.

6. Eliminating Prevailing Wage does not have significant effect on the cost of projects. Michigan temporarily eliminated Prevailing Wage in 1994 based on the promise that paying lower wages would save taxpayers money. That did not happen and Prevailing Wage was reinstated. Research shows that repealing Prevailing Wage has no impact on construction costs. However, it does have large impact on the wages and benefits paid to workers and the construction profits.

7. Follow the money. If eliminating Prevailing Wage does not decrease total construction costs but lowers wages and benefits of skilled trades workers, who benefits from the increased profit margins? If you guessed non-union construction companies, you are right! Therefore, it is no surprise who is bankrolling this effort, which is a collection of non-union construction companies called the Associated Building Contractors of Michigan. Not only have they bankrolled the repeal effort but they are also one of the largest contributors to the Republican Party and Republican candidates in Michigan. Many Republican politicians have made repealing Prevailing Wage a priority. On the other hand, Republican Governor Rick Snyder, who is term limited and cannot run for Governor again, does not support their effort.