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Michigan to reinstate prevailing wage after right-to-work repeal

Michigan to reinstate prevailing wage after right-to-work repeal
Michigan to reinstate prevailing wage after right-to-work repeal 01:42

(CBS DETROIT) - Along with repealing the right-to-work law, Michigan has also reinstated the prevailing wage. The law requires union-level pay and benefits for any publicly-funded state construction projects.

"Prevailing wage, here in this local area, could be anywhere from $30, maybe $50 or $75 an hour, so well beyond what the average person here in Michigan gets paid," said Keith Ledbetter, president and CEO of the Associated Builders and Contractors of Southeastern Michigan.

They represent about 260, mostly non-union, construction contractors. Ledbetter said they do not support the prevailing wage. 

"It's clumsy, it's inconvenient. It pays on a pay scale that doesn't really make sense for a lot of contractors. It's really just not worth the effort," he said. 

Supporters of prevailing wage say it benefits workers, and allows contractors to win jobs based on their work, not on how cheaply they can pay their workers. Ledbetter argues that prevailing wage rates can be higher than market rates, and discourages non-union companies from bidding for jobs. 

"What can taxpayers expect as a result of that? They can expect the fact that prices are going to go up for construction projects."

Ledbetter said if prices go up, taxpayer dollars won't go as far with construction projects like Michigan's schools and roads. 

Michigan first enacted the prevailing wage law nearly 60 years ago, but it was repealed in 20-18. In 2021, Gov. Gretchen Whitmer restored the prevailing wage for some state-funded projects, but this new law includes local government projects as well. 

Ledbetter questioned why prevailing wage law only impacts construction jobs. 

"You would think that if prevailing wage was such a big deal, you would see it across multiple industries."

Michigan's prevailing wage law is set to go into effect next year. 

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