GOP Killing a Wisconsin Wage Law Didn’t Save Money, It Just Gave Construction CEOs a Raise

The 2017 repeal of prevailing wage rules resulted in fewer local contractors getting work, declining blue-collar wages, yet no savings for state government.

The only things the Republican-led repeal of Wisconsin’s prevailing wage laws have accomplished so far are increasing income inequality between blue collar workers and CEOs, and taking work away from local contractors, according to a study released Friday by the Midwest Economic Policy Institute.

The study, first released to and reported by Wisconsin Public Radio, examined trends in the state construction industry after the 2017 repeal of laws that set minimum wages for workers on public construction projects, such as roadwork, based on similar pay for private jobs. While proponents of the repeal argued it would save state and local governments money, the MEPI study found it has done no such thing.

“The repeal of prevailing wage was not a good thing at all,” said Dave Branson, executive director of the Building Trades Council of South-Central Wisconsin. “It has lowered the standards of prevailing wage work, construction work.”

Among the study’s most striking findings were that rank-and-file construction workers saw wages decrease by an average of 6% while CEO wages grew by 54%. Further, the Wisconsin Department of Transportation is getting 16% fewer bids for projects, and the DOT is awarding contracts to out-of-state firms 60% more frequently.

All the while, the study found “no discernible difference” in the average project cost.

“Everything we talked about in committee, every issue that we brought up, has come true,” said Rep. Chris Sinicki, D-Milwaukee, a member of the Assembly Labor Committee. “Jobs are going out of state, there is a huge wage discrepancy, they’re getting subpar work. Everything that we predicted was going to happen, is happening.”

Branson said that beyond not saving the state any money, the repeal has caused a “ripple effect” that has harmed local economies.

“If the members aren’t working, they’re not gonna go out to local restaurants; they’re not going to be able to take their family out to eat; they’re gonna be spending less money in the grocery store; they’re not gonna be able to take trips on weekends,” Branson said. “You’re taking money out of the local economy.”

The mid-2010s were a hotbed for Republican attacks on labor in Wisconsin. Prevailing wage laws were repealed under the guise of saving money a few years after Republican Gov. Scott Walker oversaw Act 10, which gutted public worker unions, and soon after Walker signed the state’s right-to-work law, which weakened private employer unions.

“This was nothing more than another union-busting stunt that they pulled,” Sinicki said.

Assembly Speaker Robin Vos (R-Rochester) and Senate Majority Leader Scott Fitzgerald (R-Juneau) initially resisted a total repeal of prevailing wage laws, but hardline conservatives eventually won out. A group of Republican senators, whom Vos called “terrorists,” held up voting on the state’s 2017-19 budget until an immediate prevailing wage repeal was included. 

Vos and Fitzgerald’s offices did not immediately respond Friday to a request for comment on the MEPI study.

The DOT did not immediately respond to a request for comment.

Gov. Tony Evers suggested reinstating prevailing wage laws in his 2019-21 budget, but the proposal was not included in the final budget. Sinicki said she is hopeful Republican leadership will be willing to debate bringing the laws back in the next budget cycle, now that statistics show the repeal harmed workers and didn’t save the state money.

During a September campaign stop in Manitowoc, Democratic presidential nominee Joe Biden advocated for prevailing wage laws, saying they were part of his plan to revive the American manufacturing industry.