Backfire? Study Finds “Right-to-Work” Lowers CEO Pay in Construction

[Omaha Steve]

http://wepartypatriots.com/wp/2014/02/05/backfire-study-finds-that-right-to-work-lowers-ceo-pay-in-construction/

A study compiled by Frank Manzo of the Illinois Economic Policy Institute (ILEPI) and Bob Bruno of the University of Illinois, “Which Labor Market Institutions Reduce Income Inequality? Labor Unions, Prevailing Wage Laws, and Right-to-Work Laws in the Construction Industry,” has been applauded by labor because it shows prevailing wage laws do a good job of matching common construction rates with the actual market price of labor. The study concludes that worker income increases by just 1.4 percent in prevailing wage scenarios and that the laws have no effect on the wages earned by the CEO’s of contracting firms. Perhaps more importantly, prevailing wage laws help reduce income inequality between the lowest and highest paid in the industry by 45.1 percent.

Another interesting, overlooked finding from the study, however, focuses on the effect “Right-to-Work” has on the wages of contractor CEOs. While non-union contractor CEOs frequently support “Right-to-Work” laws, it turns out these laws can also lower their pay. The Building and Construction Trades Derpartment (BCTD) of the AFL-CIO highlighted this drawback in a blog post:

Right-to-work reduces construction occupation worker incomes by 13.5 percent. Because it lowers wages in the state economy and reduces consumer demand, CEOs of construction firms also see income reductions due to the policy. Overall, in addition to drops in total incomes, right-to-work increases inequality by between 2.5 and 8.2 percent in construction.

The benefits to workers, the BCTD adds, are undeniable:

FULL story at link.

http://helmetstohardhats.org/

[daleanime]

1. K&R....

[gejohnston]

2. karma?