Workplace Safety and Quality of Construction

There is conflicting evidence on the question of what effect prevailing wage laws have on workplace safety. A regression analysis of nonfatal injury rates between 1976 and 1999 done by economist Hamid Azari-Rad shows lower injury rates in states with prevailing wage laws. Depending on the class of injury, prevailing wage laws were associated with injury reductions of as much as 10.2 percent.[45] But data compiled by the Occupational Safety and Health Administration between 1975 and 1978 tell a dramatically different story: States without prevailing wages had significantly lower construction injury rates.[46] Furthermore, OSHA data show that states that repealed their prevailing wage laws between 1978 and 1990 had declining injury rates, just like states that had prevailing wage laws throughout that period and states that did not have prevailing wage laws.[47] As in the earlier OSHA numbers, states without prevailing wage laws tended to have lower injury rates than states with prevailing wage laws. Unlike Azari-Rad’s data set, the OSHA figures included fatal injuries, making the OSHA data more complete.

In the end we cannot draw any firm conclusions on injury rates, partly because of the conflicting evidence, and partly because there has been no direct comparison of injury rates between prevailing wage jobs and non-prevailing-wage jobs (regardless of the state in which the work was performed). As we will see later, this kind of job-by-job comparison has been performed numerous times for overall construction costs. Regardless, it appears unlikely that prevailing wage repeal would bring about a increase in construction workplace injuries — and might very well be associated with a decrease.

Nor is there compelling evidence that prevailing wage laws improve the quality of construction, although this is a difficult thing to quantify and track, and few studies have dealt with this aspect of prevailing wages. One measurement, admittedly crude, of the effect that prevailing wage laws have on construction quality is a survey of public school officials in Ohio performed by the Ohio Legislative Service Commission in 2000, two years after Ohio exempted public school districts from the state’s prevailing wage law. Only 2 percent of school officials reported that the quality of construction had declined, indicating that prevailing wage laws had no effect, or at least that school districts had other means at their disposal to ensure that construction work was performed competently.[48]

In a more extensive report issued a year and a half later by the OLSC, the overwhelming majority of respondents, 91 percent, reported no change in construction quality since the exemption took effect, while 3 percent reported lower quality and 6 percent reported that construction quality had improved.[49]