The Free Press, Mankato, MN

Editorials

June 16, 2008

Our View: Tough time for prevailing wage

No one begrudges a decent wage for skilled and unskilled laborers in the area.

But Mankato’s consideration of a prevailing wage ordinance comes at a bad time.

Residents are struggling to keep up with spiraling inflation and stagnant paychecks. Local governments say they are falling behind each year in funding. That’s why instituting a prevailing wage plan, which would drive up the cost of at least some public projects, is difficult to support.

The state already has prevailing wage rules for state-funded projects. Under the proposal before the Mankato City Council, the same rules would apply to city-funded project. The state sets the prevailing wage in dozens of job categories.

During initial discussion, there have been widely varying estimates of how much a local prevailing wage would add to project costs — from zero to some 40 percent.

Unions representing many of construction workers in the area argue that the prevailing wage rules used in state contracts don’t drive up the cost of projects.

That appears to be true in the Twin Cities metro area, where the going market cost for construction projects is about the same as the cost required under the state’s prevailing wage law.

But in outstate Minnesota, where wages and living costs are lower, prevailing wages do appear to drive up the cost of public projects, sometimes substantially.

A St. Cloud contractor doing a state project at St. Cloud State, told a television station that he is paying more than 30 percent more for the wages of his employees than he normally would.

As the council continues with hearings on a local prevailing wage it needs to get more accurate information about the potential cost increases and it should move slowly and skeptically on the proposal.

Spending taxpayers’ money conservatively is always important. In times of daunting economic challenges, it’s even more important.



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