Labor & Employment Law

Study: Union Construction Jobs Help Economy

By James Parks

A new study shows union construction jobs not only provide workers with a good middle-class income, but the benefits extend to the communities and states where they live.

The report, “The Socio-Economic Impacts of Construction Unionization in Massachusetts,” by Maria Figueroa and Jeff Grabelsky of Cornell University’s School of Industrial and Labor Relations, found the earnings of union construction workers in Massachusetts added $4.6 billion overall to the Bay State economy in 2007.

Says Mary Vogel, executive director of The Construction Institute, which released the study: 

This study confirms what we already knew to be true-unionization in the construction industry not only creates middle class career opportunities in the building trades for Massachusetts residents, but results in significant economic benefits for the Commonwealth and the local communities in which our members live and work.

While many employers are pushing down wages and benefits, the authors found that union construction wages are helping hold up standards. For example, Massachusetts union construction workers earn an average of $13 more per hour than nonunion workers. When benefits are included, they average $28.35 more per hour than their nonunion counterparts. Those wages generate countless benefits for the Massachusetts economy, resulting in more than $2 billion in additional income for building trades’ members and a total income gain of $1.74 billion for all Massachusetts families.

With state economies across the country in a tailspin, union construction wages helped boost Massachusetts’ economy. At the same time, nonunion construction workers added to the state’s social and economic costs. Nonunion construction workers have mostly inadequate or virtually non-existent health care coverage, which shifts the cost of their care to taxpayers.

Writing in Daily Kos, The Electrical Worker says:

Anti-union groups, like Associated Builders and Contractors, routinely denounce union labor for its higher wages, but the study finds that nonunion labor isn’t necessarily cost-effective.

He quotes the study:

There are economic and social costs associated with the lower quality of the training provided to nonunion workers, and the consequent higher number of occupational injuries they endure….Labor cost savings, however, can translate into costs being shifted onto taxpayers and society as a whole, when employers fail to pay appropriate levels of payroll taxes and workers’ compensation premiums.

The study also found:

• Employers often deliberately misclassify nonunion construction employees to pay them lower wages, which results in millions lost in state income and payroll taxes.
• Federal Occupational Safety and Health Administration (OSHA) records for the Massachusetts construction industry reveal that 88 percent of the violations between 2004 and 2009 were committed by nonunion contractors.

To read the full report, click here.

Full post as published by AFL-CIO NOW BLOG on April 15, 2010 (boomark / email).