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About Northwest labor press. (Portland , Ore.) 1987-current | View Entire Issue (Jan. 15, 2021)
PAGE 2 | January 15, 2021 | NORTHWEST LABOR PRESS NORTHWEST LABOR PRESS (International Standard Serial Number 0894-444X) Established in 1900 in Portland, Oregon as a voice of the la- bor movement. Published on a semi-monthly basis on the first and third Fridays of each month by the Oregon Labor Press Publishing Co. Inc., a non-profit mutual benefit corpo- ration owned by 20 unions and councils including the Ore- gon AFL-CIO. Serving more than 120 union organizations in Oregon and Southwest Washington. Office location: 4275 NE Halsey St., Portland, Oregon Mailing address: P.O. Box 13150, Portland, OR 97213 Phone: (503) 288-3311 Web address: http://nwlaborpress.org Editor & Manager: Michael Gutwig Senior staff reporter: Don McIntosh Office manager: Jill Lukens Printed on recycled paper, using soy-based inks, by members of Teamsters Local 747-M. SUBSCRIPTIONS: Individual subscriptions are $15 a year for union members, $23 a year for all others. Pay by credit card online at nwlaborpress.org/subscribe, or send a check to our mailing address (above) along with your name, address and union affiliation, if any. Group rates of 47 cents an issue per member — $11.28 a year are available for 25 or more subscriptions; call 503-288-3311 for details. CORRECTIONS: See an error? Please let us know at editor@nwlaborpress.org or by phone at 503-288-3311. PERIODICALS POSTAGE PAID AT PORTLAND, OREGON. CHANGE OF ADDRESS: If you move, let us know at nwlaborpress.org/subscriber-services or by mail at our mailing address (above). Be sure to provide your old and new addresses and the name/number of your local union. Please allow three weeks for the change to take effect. POSTMASTER: Send address changes to NORTHWEST LABOR PRESS P.O. BOX 13150 PORTLAND, OR 97213-0150 WORKERS RIGHTS Oregon’s prevailing wage law analyzed A new study finds the law raises wages, but not project cost. By Don McIntosh Oregon’s prevailing wage law results in 8% higher wages for workers on public construction projects, but doesn’t increase the cost of the projects, according to a new study co-authored by Frank Manzo of the Illinois Economic Policy Institute and Lina Stepick of the University of Oregon Labor Education and Research Center (LERC). That might seem counter-intuitive, until you get to the likely expla- nations. First, the labor cost for the hourly construction workers covered by the law is a small share of total project cost— about 25% in Oregon, according to the study authors. Materials, equipment, fuel, rental costs, management salaries, taxes, li- censes, etc. make up the other 75%. So even if craft workers get paid 10% more, that equates to 2.5% of project cost. But it doesn’t seem to raise project cost, Stepick and Mazzo concluded, because contractors seem to react by employing higher skilled and more produc- tive workers, and accepting a smaller profit margin. Prevailing wage laws set the minimum hourly pay and bene- fits for workers in each craft specialty so that bidders don’t compete for public contracts based on who can pay the least. Stepick and Manzo analyzed more than 1,100 contractor bids on nearly 300 state highway projects in Oregon and Idaho. Idaho doesn’t have a state pre- vailing wage law, but 79% of its road projects were federally funded and thus subject to the federal prevailing wage law. That allowed researchers to compare projects that paid the prevailing wage to those that didn’t. They found no difference in cost per mile. Manzo has found similar results in his stud- ies of prevailing wage laws in at least 10 other states. The Oregon report also in- cludes a summary of peer-re- viewed studies of the effect of prevailing wage on the cost of school construction, highway maintenance, and municipal building projects. [A peer-re- viewed study is one that’s ac- READ THE FULL STUDY nwlaborpress.org/pw-study cepted for publication in an ac- ademic journal after peers in the same specialty review and vali- date the research.] Out of 18 peer-reviewed studies of pre- vailing wage since 2000, 15 found no impact on cost, while three found the laws increased project costs 2%, 8% and 13%. Stepick and Mazzo’s study also splashes cold water on other arguments that opponents of prevailing wage sometimes make, like that the law’s com- plexity results in fewer bidders, less competition, and therefore increased cost. Comparing the Oregon and Idaho contracts, they found there were actually 19% more bidders on prevailing wage projects. Prevailing wage is also strongly correlated with appren- ticeship training: Apprenticeship enrollments are 6% to 8% higher in states with prevailing wage, and states that repeal the prevailing wage see significant drops in apprenticeship. Twenty-eight states have pre- vailing wage laws. Oregon’s has been in effect since 1959, but came under attack by Republi- can leaders in the mid-1990s. When opponents put a repeal of the prevailing wage on the ballot in 1994, voters rejected the measure by 62%. “Prevailing wage levels the playing field, boosts investment in apprenticeship training pro- grams, improves productivity and worksite safety, and stabi- lizes construction costs,” Stepick and Mazzo write. “Ore- gon’s Prevailing Wage Rate Law levels the playing field for contractors by taking labor costs out of the equation, incentiviz- ing them to compete based on core competencies and efficien- cies in construction rather than on undermining middle-class compensation standards.” Hours: Mon-Sat 12-6 pm Closed Sunday PLEASE SHOW OUR ADVERTISERS YOU APPRECIATE THEIR SUPPORT FOR THIS LABOR MOVEMENT NEWSPAPER!
