Posts tagged Davis-Bacon Act
Cato Institute: Reforming Labor Union Laws
July 29, 2025 // The 1930s labor union laws were premised on the false idea that management and labor are enemies in the workplace, notes Baird. The reality is that individuals and businesses work together to produce products for consumers. Management and labor are complementary, not rivalrous, inputs to value generation in the economy. The new Cato study is a great introduction to federal labor union laws from a libertarian perspective. Baird concludes that American workers would enjoy more freedom and prosperity if the labor laws of the 1930s were repealed.
Free the Economy podcast with Vinnie Vernuccio of the Institute for the American Worker
March 27, 2025 // Our interview for Episode 116 of the Free the Economy podcast is with Vinnie Vernuccio of the Institute for the American Worker. We talk about labor unions, independent contractors, right-to-work laws, port automation, and the future of the American workforce. Free the Economy is hosted by Richard Morrison. Our co-producer and editor is Destry Edwards. Keep up with new episodes by following us on Twitter at @freethe_economy and read our episode summaries, with links to the stories we cover, at cei.org/blog.
Opinion: Free Raises for Everybody. Not.
August 17, 2023 // One obvious result will be higher costs on public works and probably fewer of them since federal dollars won’t go as far. States and localities may have to borrow more and raise taxes to fund projects. Fewer semiconductor fabs and renewable projects will probably be built since private capital won’t go as far. Another result will be less private investment, especially in housing, since contractors will have to increase wages to compete for workers with federally funded projects that must pay the prevailing wage. The rule will also reduce the competitive advantage of right-to-work states by raising the wages their contractors have to pay.
ABC: Final Davis-Bacon Rule Undermines Taxpayer Investments in Infrastructure
August 9, 2023 // “The final rule comes in the midst of challenging economic conditions facing the construction industry, including high materials costs and a skilled labor shortage of more than half a million in 2023,” said Brubeck. “The onerous new requirements and artificial inflation of construction costs imposed by this rule will only exacerbate these headwinds and undermine taxpayer investments in infrastructure.” ABC submitted nearly 70 pages of comments on the DOL’s proposed rule, and its more than 50 significant changes, urging the DOL to withdraw the proposal. The 1931 Davis-Bacon Act and related regulations require contractors and subcontractors that perform work on federal and federally funded construction projects of $2,000 or more to pay a government-determined prevailing wage and benefit rate on an hourly basis to on-site construction workers. According to the DOL rulemaking, the Davis-Bacon Act and 71 active Related Acts collectively apply to an estimated $217 billion in federal and federally assisted construction spending per year—about 63% of all government construction put in place—and provide government-determined wage rates for an estimated 1.2 million U.S. construction workers. The Congressional Budget Office estimates that repealing the 1930s-era Davis-Bacon Act would save the federal government $24.3 billion in spending between 2023 and 2032. A May 2022 study found that the Davis-Bacon Act costs taxpayers an extra $21 billion a year, increases the price tag of construction projects by at least 7.2% and inflates construction workforce wages by 20.2% compared to local market averages if the DOL calculated prevailing wages using modern and scientific methodology via the U.S. Bureau of Labor Statistics.
In Philly, VP Harris details new labor rules for federal construction projects
August 9, 2023 // Vice President Kamala Harris, on Tuesday, visited Philadelphia to announce changes to labor rules that could give higher wages to construction workers on federal projects. At the headquarters of labor union DC 21, in Northeast Philly, Harris detailed the Labor Department's first update in decades to the Davis-Bacon Act of 1931, a law that requires the payment of prevailing local wages on public works.
Biden Labor Department offers new rule on “prevailing wages” that is less accurate
August 8, 2023 // “The Biden administration’s decision to turn back the clock on Davis-Bacon Act regulations to a Carter administration-era version will benefit a few well-connected unions while raising costs on taxpayers. The administration’s new rule will allow a survey of just a third of workers to calculate the ‘prevailing wages’ to be used when awarding federal contracts. It only takes a basic understanding of math to know that that 30 percent is not a majority and therefore cannot be said to be ‘prevailing’ in any common understanding of the term. Rather this new rule will allow for cherry-picked statistics that result in wage inflation, driving up the costs of those contracts.”
It’s a Gloomy Outlook for Jobs Under Biden. Here’s the Formula to Change That.
May 19, 2023 // For the sake of personal and societal happiness, for the sake of the financial well-being of American families, for the sake of solving America’s dire fiscal situation, and for the sake of preserving the foundation of American society, policymakers need to recognize the value and rewards of work. By protecting individuals’ rights to pursue the type of work and compensation that is best for them, expanding alternative education and job-training opportunities, and not forcing workers into unions, policymakers can expand opportunities for people to achieve meaningful and rewarding work. Work truly affects every aspect of American life. Our economy, our personal financial and physical well-being, our nation’s fiscal sustainability, and even our national security depend on it.