Pannebecker: Prevailing wage bad for Michigan
The effort to allow workers in Michigan the freedom to decide for themselves whether to join and financially support a union was won in 2012, and became law in 2013. Michigan is now enjoying the job creating benefits of that reform, and is better off for it. The union bosses claimed that this freedom would destroy unions and dramatically reduce wages and benefits. That argument has been proven false, but the union bosses and the Democratic Party are trying to use it again to prevent the prevailing wage law from being repealed.
Prevailing wage seeks to eliminate competition for public works projects involving taxpayer’s dollars, by forcing the state and municipalities to pay inflated “union scale” wages to workers, whether they belong to a union or not. This essentially prevents a non-union contractor from submitting a lower bid on a project by inflating their labor costs, thereby essentially eliminating competition to the unionized companies and inflating the costs to taxpayers on major public projects like schools and other publicly funded capital-improvements.
The pro-jobs group Protecting Michigan Taxpayers collected and submitted nearly 400,000 signatures from Michigan voters, well over the 252,000 required to send the repeal legislation directly to the Legislature. If the Bureau of Elections certifies that enough of the signatures collected are valid, then the petition will be forwarded to the State Board of Canvassers. Once the Legislature has it, lawmakers would then have 40 days to act on the petition. The leaders in both houses in Lansing are on record as supporting repeal of the prevailing wage law.
This effort is not an attack on unions or unionized workers; it is an effort to save all taxpayers millions of dollars that government is being forced to pay out in inflated labor costs to prop up unions. A 2013 report by the Anderson Economic Group estimated that Michigan’s prevailing wage law “cost state and local governments an extra $224 million a year on education-related construction projects between 2002 and 2011.”
Beyond the extra cost, the taxpayer-subsidized labor costs drive away contractors who feel they cannot compete due to the forced wages law. The repeal effort is supported by the Michigan Association of Builders and Contractors, a trade group made up of mostly non-union building contractors.
Voters and taxpayers can play an important role in the ultimate decision by the Legislature to repeal this costly law. During the upcoming weeks when the petition signatures are being validated, voters should call, email or write a letter to their representative and or their senator, and let them know they support the effort to end inflated costs on government construction projects in Michigan.