Public policy choices have consequences.

Some can facilitate middle-class job creation, economic growth, a skilled workforce, and balanced government
budgets. Others can have just the opposite effect.
It is critical for lawmakers and voters to examine the facts and make sound policy decisions. Nowhere is this
approach more critical than in the local debates over the merits of Illinois prevailing wage law.
According to a recent article in QCOnline.com, Port Byron village board members have been engaged in this
debate. A recently passed resolution approved local prevailing wage rates on public construction projects but
also included several clauses opposing the law. The resolution claims that prevailing wage currently adds at
least 20 percent to project costs.
First, the notion that localities could save money by repealing prevailing wage is false. Economic studies
consistently find that states that have repealed their prevailing wage laws realized no cost savings. In addition,
economic data reports that labor costs account for just 23 percent of total costs on public works construction
across Illinois. Its mathematically impossible to save 20 percent on total costs unless workers were paid less
than minimum wage.
Prevailing wage requires that construction workers be paid no less than the local market rate. It is a fair wage
that allows workers to support middle-class families. That said, the median homeowner cost in Rock Island
County is still 28 percent of an operating engineers annual take-home income if he or she earns the prevailing
wage. Prevailing wage does not produce a lifestyle free from the paycheck-to-paycheck concerns of Main
Street Americans.
Prevailing wage does support apprenticeship programs to train workers for lifelong careers in construction.
The typical construction worker completes over 6,400 hours of objective, certified training 600 more hours
than the requirements for a bachelors degree from the University of Illinois. Prevailing wage is good for
contractors because it makes their labor costs predictable and provides them with a high-skilled workforce.
Prevailing wage is good for taxpayers because it ensures that the roads we drive on and the schools our
children go to every day are of the highest quality. Infrastructure is built by productive workers of responsible
contractors.
Repeal of prevailing wage would mean lower wages, drops in training and productivity, and more bids awarded
to out-of-state businesses. The result is that repeal would shrink the economy by $1.1 billion and increase
unemployment by 3,300 workers. In addition, the Illinois Economic Policy Institute conducted a study on the
public construction labor market in northwest Illinois counties, available at www.illinoisepi.org.
Again, policy choices have consequences. In the case of prevailing wage, the data shows that the choice is
clear: repeal means fewer jobs, a slower economy, more Rock Island dollars going to workers from other
states, fewer skilled workers, and zero cost savings.
No matter how you slice it, that's a bad bargain for taxpayers.
Frank Manzo IV
Policy Director
Illinois Economic Policy Institute