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US construction workers get “massive” wage rise

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Summary

The US Department of Labor (DOL) has updated the prevailing wage rule for federally funded construction projects to require higher wages for workers. This change, which was announced in a speech by Vice President Kamala Harris, is said to give workers "thousands of extra dollars" a year, and is supported by the union federation AFL-CIO. Contractors' organisation AGC, however, criticised the DOL for not updating the way the prevailing wage rate was determined. It also reported that the construction sector added 19,000 jobs in July, and that the average hourly earnings for production and nonsupervisory construction workers had jumped by 5.8%.

Q&As

What changes has the US Department of Labor (DOL) made to the prevailing wage rule for federally funded construction projects?
The US Department of Labor (DOL) has updated the so-called prevailing wage rule for federally funded construction projects, saying people working on them would earn “thousands of extra dollars” a year. The new rule announced 8 August will make the prevailing wage equivalent to the wage paid to at least 30% of workers in a given trade in a locality, instead of 50% of workers.

How much of a wage increase are construction workers expected to receive?
Construction workers are expected to receive thousands of extra dollars a year.

How did the Reagan administration change the prevailing wage definition?
Before, according to the White House, if the majority of workers in a given trade and locality did not earn a single wage rate, then the prevailing wage was determined by the average wage. The Reagan administration changed this definition by setting the prevailing wage to the average wage.

What did Vice President Kamala Harris say about the Biden-Harris administration's efforts to support working people?
Vice President Kamala Harris said the Biden-Harris administration was “giving workers across the nation a raise”.

What is the Associated General Contractors of America (AGC) concerned about with the DOL's changes to the prevailing wage?
The AGC is concerned about the DOL's reliance on voluntary surveys to produce and update wage determinations, which it believes has created a compensation system for Davis-Bacon covered construction that poorly reflects the construction labour market in many parts of the country.

AI Comments

👍 I'm so pleased to see that the US Department of Labor is working to ensure workers on federally funded construction projects are adequately compensated for their work. This new rule is a great step forward for fair wages!

👎 It's disappointing that the Associated General Contractors of America feels that the US Labor Department's rule will have a negative impact on the federal construction market. This could potentially leave workers at a disadvantage.

AI Discussion

Me: It's about how construction workers in the US are getting a "massive" wage increase. The US Department of Labor has updated the prevailing wage rule for federally funded construction projects. The new rule means workers on these projects will earn thousands of extra dollars a year.

Friend: Wow, that's great news for construction workers!

Me: Yes, it is. The Biden-Harris administration is trying to make the economy work better for workers. Union organizations are praising the new rule, but the contractors' organization is concerned about the effect it will have on the federal construction market. They're also calling for the Department of Labor to find more accurate data to determine wages.

Action items

Research the Davis-Bacon and Related Acts to understand the implications of the new rule.
Reach out to local unions to learn more about how the new rule will affect construction workers in your area.
Contact your local representatives to advocate for further wage increases for construction workers.

Technical terms

Prevailing Wage: The minimum wage rate that must be paid to workers on a federally funded construction project.
Davis-Bacon and Related Acts: A law that requires contractors and subcontractors working on federally funded construction projects to pay their workers the prevailing wage.
White House: The official residence and workplace of the President of the United States.
AFL-CIO: The American Federation of Labor and Congress of Industrial Organizations, a federation of labor unions in the United States.
Associated General Contractors of America (AGC): A national trade association representing the construction industry.
Trickle-down economics: An economic theory that suggests that tax cuts and other economic benefits for the wealthy will eventually benefit the rest of society.
Wage Theft: The illegal practice of not paying workers the wages they are owed.
Production and Nonsupervisory Construction Workers: Workers who are involved in the production of goods or services, but who are not in a supervisory role.