Construction wages cut in half by new prevailing wage rules

Liuna Website (Laborers International Union of North America)

According to Jeff Phillips, Communications and Outreach Manager of the Laborers International Union of North America in St. Joseph, construction workers in many rural Missouri counties are working for less this Labor Day holiday.

Missouri’s new prevailing wage law has cut wages for construction workers in many counties, sometimes by more than half. The new formula that calculates the wage for public works projects was approved by Missouri lawmakers last year and went into effect on July 1st.

One of the counties hardest hit was Grundy County in northwest Missouri. The new prevailing wage for construction laborers on building projects is $19.81 an hour, as compared to $39.56 an hour in 2018. Heavy highway laborers this year will earn $19.81 an hour, down from $40.63. The higher wage often included benefits like health insurance and pensions. The new wage applies to all construction crafts in Grundy County.

“This is not a union problem. It hits everyone who works construction, union, and non-union, across all trades,” said Jason Estes, Business Manager of Laborers Local 579 in St. Joseph. “These pay cuts are hitting many of our rural counties hardest, where construction wages are the best jobs available in these communities. These are the people and places who need these family-wage jobs most.”

The new law calculates the wage based on public works projects with more than 1,000 hours worked, and a project cost of more than $75,000. The wages are broken down into two categories: Building, which includes projects like schools, and state and local government facilities; and Heavy Highway, which includes any local, county, state or federal road or bridge.

“The consequences are obvious. Lower wages often lead to lower quality work,” said Western Missouri and Kansas Laborers District Council Business Manager Tim Bell. “When these jobs are public works projects like schools, roads, and bridges, we are putting our safety in the hands of the people willing to do it the cheapest.”

Opportunities shrink the farther away a community is from an urban area. Construction wages provide an economic boost to local businesses and build the tax base in rural communities. These lost wages will hurt families, the businesses they support and the schools where they send their kids.

To review to new prevailing wage rates in Missouri, visit the Missouri Labor website. Wage Order 26 lays out wages for 2019. You can also look at Wage Order 25 to see how each county and the construction trades were affected by the new law.

You can visit the Laborers International Union of North America for more information.