Low-wage non-union construction industry jobs aren’t just hard on the workers. They’re also a strain on public tax dollars, according to new research.
The Labor Center, located at the University of California, Berkeley, this month published research examining the impact of low-wage construction jobs both nationally and in specific states, including Washington.
Titled “The Public Cost of Low-Wage Jobs in the Washington Construction Industry,” the report found construction workers are enrolled in programs such as Medicaid and food stamps at a higher rate than workers across all industries.
It found 38% of Washington construction workers’ families are enrolled in at least one of the major federal assistance programs, compared with 32% of all working families. And 22% of Washington construction workers have no health insurance—three times the uninsured rate for all workers across the state.
The conditions for this segment of the construction industry are particularly striking, because elsewhere in the industry, construction provides good wages, benefits and a path to the middle class without a college degree. This split has been developing since the 1960s and is directly tied to a decline in unionization, according to the researchers. They report that 42% of U.S. construction workers were union members in 1971, a number that fell to 12.6% by 2019.
The drop in unionization correlated with a 17% decline in average hourly earnings for all construction workers between 1973 and 2006. The prevalence of employer-provided health insurance and retirement plans declined as well.
As of 2015, union construction workers made 42% more in wages and 78% more in total compensation than non-union construction jobs, according to the Labor Center.
Fewer union construction jobs also opened the door to more exploitation of workers, through companies misclassifying employees as independent contractors or paying them under the table—practices that some employers use to reduce costs.
In a statement to the Labor Press, the Northwest Carpenters’ Union said the research reinforces the need for worker protections and enforcement against bad actors.
“The industry and public officials need to ensure that these low-road employers are held accountable and not turn a blind eye to practices that reward profits at the expense of the workers,” the union wrote.
The researchers made a similar point, stating that without legislative action, “construction workers in Washington should expect to continue to be exploited and cheated, and lawful contractors should expect to find it more and more difficult to compete in the industry.”
