The Effects of Repealing Common Construction Wage in Indiana

The Indiana legislature repealed Common Construction Wage in 2015, a law that set a minimum wage for construction workers employed for public projects. The Midwest Economic Policy Institute found the following negative impacts on workers and the construction industry that has follow the repeal:

1. Repeal decreased the wages of blue-collar construction workers by 8.5 percent, on average.
2. Repeal decreased the wages of the lowest-paid construction workers by 15.1 percent, contributing to
greater wage inequality in construction.
3. Repeal was statistically associated with a 4.5 percentage-point increase in the share of workers in
construction occupations without a high school diploma or equivalent.
4. The share of construction workers who are military veterans fell by 1.2 percentage points post-repeal.
5. Construction worker productivity growth was 5.3 percentage-points slower in Indiana than in
neighboring Midwest states following repeal.
6. Relative worker turnover increased by 1.2 percentage points in Indiana’s heavy and highway
construction sector following repeal.
7. Employment growth in public works construction was 1.5 percentage-points slower in Indiana than in
neighboring Midwest states following repeal, and evidence suggests that repeal has resulted in more
out-of-state workers employed on public projects in Indiana.
8. The average number of bidders on public projects in northern Indiana was 3.0 before repeal and 2.9
after repeal.
9. Common Construction Wage did not favor union contractors, as the union share of northern Indiana’s
public construction market stayed the same or even increased following repeal.
10. Repeal had no statistical impact on the average cost per public school project in northern Indiana.

https://midwestepi.files.wordpress.com/2018/01/mepi-csu-effects-of-repealing-common-construction-wage-in-indiana-final.pdf