In a recent letter to the Senate, SMACNA voiced its strong opposition to The Transportation Investment Recalibration to Equality (TIRE) Act, offered by Senator Flake. The TIRE Act would eliminate the Davis-Bacon Act’s prevailing wage language on federal infrastructure legislation, especially bills providing funds for federally assisted infrastructure construction.
SMACNA supports prevailing wage laws covering federally assisted projects in housing, energy efficiency and infrastructure legislation, regardless of political changes to Congress or the Executive Branch, where construction quality and a national funding role are paramount. The obvious economic, workforce quality and environmental benefits from including prevailing wage coverage as part of assistance to local and state economies cannot be overstated. It is ironic that at a time when the Congress and construction industry are expressing alarm over insufficient numbers of skilled construction workers that Congress would debate legislation to undercut wages, training and standards for those making up much of the infrastructure workforce.
SMACNA representing thousands of major public and private project contractors supports infrastructure legislation that recognizes the importance and value of paying prevailing wages as part of any quality based public procurement policy. Federal, state and local prevailing wage laws encourage employers to:
- Pay a locally prevailing wage
- Offer health care coverage to their employees and their families
- Provide for the future retirement of their employees and
- Make a significant investment in the future by training a skilled and safety conscious workforce.
Support of prevailing wages on direct or federally assisted public infrastructure represents a commitment to construction quality and the future. Without prevailing wage statutes, the competitive bid system will erode the wage and fringe benefit standards common in localities across the nation and dismantle Department of Labor (DOL) certified, proven training programs funded by private employers at more than $700 million annually. Support of a prevailing wage policy fosters practices and programs which lessen today’s and tomorrow’s burden on the public sector. More importantly, Davis-Bacon boosts DOL-certified skilled labor apprenticeship and training programs necessary during an era of skilled labor shortages across the nation.
DOL wage surveys report that nearly 75% of Davis-Bacon decisions for federal projects pay less than the union wage. In fact, most prevailing wage rates are far below union scale, some nearer the local or state minimum wage, almost all without fringe benefits of any kind. Prevailing wage laws seek to prevent the federal government from undermining local economies and prevailing local employment and training practices by reflecting local conditions.
SMACNA is also asking the Senate to carefully reconsider the critical role the Davis-Bacon Act plays in maintaining a well-trained, highly productive skilled construction workforce. To date this important impact has been almost entirely overlooked, even from the most alarmed over skilled labor shortages. When productivity, quality of workmanship and life cycles costs of construction are taken into consideration, it becomes apparent that prevailing wage laws are NOT costing the government money, but save federal dollars. More than half of major private construction is awarded based upon a negotiated rather than a low-bid basis for this very reason- -first costs are not a true indication of the overall cost or quality of construction projects. Numerous studies in recent years have used actual Dodge Reports for thousands of construction projects to document lower costs for certain building types in prevailing wage states as compared to non-prevailing wage states due to the greater productivity of trained, skilled workforce.
While Congress has received largely misleading, exaggerated and inaccurate information from anti prevailing wage forces on both the estimated savings and the policy consequences of using locally prevailing wages, SMACNA applauds the bipartisan support for the Davis Bacon Act already evidenced in the 115th Congress. First-rate construction industry firms should not be disadvantaged when bidding federal projects because they offer their employees locally prevailing wages, health care, pensions and the highest level of skill training. This would be the impact if the prevailing wages were excluded from major federal infrastructure legislation regardless of the form of economic assistance. Skilled labor shortages will only grow worse if we undercut the major federal factor in supporting certified, national apprenticeship programs producing the largest portion of the skilled workforce needed for current and future complex projects. 1/16/17