News and Tribune


July 30, 2013

LETTER: The benefits of the Common Construction Wage Act

I read with great interest the July 23 op-ed piece from Eric Schansberg of the Indiana Policy Review Foundation concerning Indiana’s Common Construction Wage Act. 

I appreciate Mr. Schansberg’s attempt to write about something so clearly outside his area of expertise. However, it would seem more beneficial to defer to the experts who have studied common wage for decades. Common wage has played a very important part in creating Indiana’s highly skilled construction work force and an environment which has allowed our local contractors to flourish nationally in the both the public and private sectors.

Under the Act, local committees identify the local-market rates for construction wages and establish them as the minimum compensation that a contractor may pay construction workers on a publicly funded project. To set the common wage either above or below the local-market rates would be a violation of the act. The purpose of the law is to protect the local construction market and keep government out of the price-fixing business.  

Without the Common Construction Wage Act, government would be free to intervene in and disrupt the free market and depress construction costs, labor included, below the local private-sector market prices. This would cause irreparable harm to local contractors and construction workers. This is why Republicans and construction contractors fought for the initial passage of this law in 1935. 

By favoring locally paid wage rates, the act works to ensure that out-of-state contractors that might skimp on wages, safety, training and build quality don’t have a competitive advantage over local contractors. 

Study after study has shown the positive effects of Indiana’s Common Construction Wage Act. If the goal is to create more jobs for Hoosiers and to help our incumbent businesses grow, we must adopt sound public policy and not failed policies that allow Hoosier taxpayers to reward out-of-state contractors and workers.

— Pete Rimsans, executive director, Indiana State Building and Construction Trades Council

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