ICERES Research Reports

Project Labor Agreements: A Research Review
Project labor agreements (PLAs) are pre-hire labor contracts between a construction owner or general contractor and labor organizations that establish the terms and conditions of employment on a specific construction project. While project labor agreements are commonly used to guide private-sector construction in the United States and Canada, their use by federal, state and local governments has been a source of controversy for decades. To inform public policy debates, this report summarizes the economic research on public-sector PLAs that has been published since 2000 and attempts to reconcile disparate findings across studies.

Plumbing Licensing, Code Compliance, and Work Quality: A National Survey of Professional Plumbing Inspectors
This study assesses how plumbing licensing laws affect the quality of plumbing work by conducting a national survey of professionals whose job it is to protect public health and safety in this area: plumbing inspectors. The results reflect that plumbing inspectors were nearly unanimous in their beliefs that licensing requirements in the plumbing trades: (a) promoted compliance with codes and standards, (b) resulted in a higher quality of work, and (c) led to fewer defects and improperly installed plumbing systems.

Registered Apprenticeship in Construction: Built to Last?
Registered apprenticeship programs are a well-established institution in the American construction industry, providing training and a pathway to family-supporting careers for blue-collar workers. This report provides a brief history of registered apprenticeship, current statistics on registrations and completions, apprentice compensation, curriculum and training structures, challenges and opportunities for apprenticeship programs in the construction industry, and a discussion on business cycle fluctuations that can disrupt apprenticeship training.

Worker Misclassification and Wage Theft in Rhode Island
This report offers a quantitative analysis on the extent and economic costs of payroll fraud in Rhode Island, with a particular focus on the misclassification of workers as independent contractors. This study reviews data provided by the Rhode Island Department of Labor and Training (DLT) on (a) aggregate results of DLT employee misclassification investigations, (b) the issuances of Stop Work Orders, and (c) the results of employer payroll audits conducted in accordance with the state’s unemployment insurance system. The authors then use these data to make projections about the number of workers misclassified statewide and the costs to workers and taxpayers.

The Social and Economic Costs of Illegal Misclassification, Wage Theft and Tax Fraud in Residential Construction in Massachusetts
This study examines labor and employment practices in the residential construction industry in Massachusetts. Our research is based on more than 60 in-depth interviews with documented and undocumented workers, union and non-union contractors, union and public officials, and community activists involved in residential construction. The results of these interviews are complemented by a comprehensive quantitative analysis of data from the Massachusetts Department of Revenue, Department of Unemployment Assistance and Department of Industrial Accidents that provides statistical projections of the extent and economic costs of worker misclassification in Massachusetts construction.

Payroll Fraud in New York’s Construction Industry: Estimating its Prevalence, Severity and Economic Costs
This report estimates the number of construction workers who were either misclassified or working off-the-books (i.e., payroll fraud) in both New York State and New York City in 2017. These estimates are then combined with state and city-specific tax and social insurance rates to develop projections about how much these illegal actions affect taxpayers in the region.

An Analysis of Construction Spending in the Pharmaceutical & Biotech Industry, 2015-2020
An examination of construction spending and employment in the pharmaceutical and biotech industry for 14 states between 2015 and 2020.

Payroll Fraud in Nevada’s Construction Industry: Extent and Fiscal Impact
This report investigates two forms of payroll fraud prevalent in Nevada’s construction industry: (a) the misclassification of workers as independent contractors and the use of cash-only, off-the-books employment arrangements and (b) misclassification and underpayment of workers on public construction projects covered by prevailing wage laws.

Should Prevailing Wages Prevail? Re-examining the Effect of Prevailing Wage Laws on Affordable Housing Construction Costs
The United States faces two parallel crises: one with affordable housing supply, and one with maintaining residential construction labor standards. Historically, issues with labor standards have been addressed on public works through prevailing wage requirements. Labor standards—while good for workers—may increase construction costs; higher costs, in turn, negatively impact low-income families by reducing supplies of affordable housing. In this paper, we re-examine whether this tradeoff exists and, if so, its extent and implications. We estimate that, because of the enhanced enforcement of labor and employment laws, prevailing wage requirements add only 0-3.3% to the costs of affordable housing construction.

The Quality of Jobs in Construction and Oil-and-Gas for High School Graduates
This study examines job quality in the construction and oil-and-gas industries, with particular focus on workers without college degrees. The report uses government data to offer insight in the following areas: (a) wages, benefits, and the advantages of apprenticeship programs, (b) workplace safety, (c) employment security, and (d) career opportunities and advancement.

An Empirical Methodology to Estimate the Incidence and Costs of Payroll Fraud in the Construction Industry
This study represents a comprehensive analysis of the extent and social costs of payroll fraud in the United States construction industry. In addition to providing a detailed review of existing research, this study uses data from government agencies to estimate the number of workers who are misclassified or are working off-the-books in the construction sector. These worker estimates are then used to project the national costs to these actions (e.g., underfunded social programs and lost tax revenue). Finally, this study provides an accessible empirical methodology for similar analyses to be conducted at state and local levels.

The Effect of State Prevailing Wage Laws on African-American Employment in Construction
This study sheds light on the debate regarding whether state prevailing wage laws reduce African-American employment in the construction industry. Using data from the Current Population Survey, the study addresses this question by using a two-part statistical analysis to investigate the effect of state prevailing wage laws on African-American participation in the construction industry over a 30-year period from 1977 to 2006. Our central finding is that there is no substantial empirical evidence that prevailing wage laws reduce African-American participation in construction or alter the choice of African-Americans to enter construction occupations.

What Does the Research Tell Us about Prevailing Wage Laws?
This paper reviews the research on prevailing wage laws. These policies establish location and job-specific minimum compensation rates for construction workers and apply to projects funded by the federal government, twenty-seven states, and numerous municipalities. Prevailing wage laws are controversial and are a source of ongoing policy debate. To better inform this debate this review finds that the most methodologically advanced research generally indicates that prevailing wage laws do not affect construction costs, promote worker safety and training, and do not have a racially discriminatory impact.

An Analysis of Construction Spending in the Pharmaceutical & Biotech Industry, 2012-2017
An examination of construction spending and employment in the pharmaceutical and biotech industry for 11 states between 2012 and 2017. Using data from Industrial Info Resources, it is estimated that the industry spent $22.4 billion in construction requiring over 45 million labor hours from construction workers.

New York’s Prevailing Wage Law: A Cost-Benefit Analysis
A comprehensive analysis of the economic impact of New York State’s prevailing wage law. This includes a review of the academic and non-academic research on prevailing wages, as well estimates of the costs and benefits of New York’s law. This article also outlines the logical fallacies in some of the arguments surrounding state prevailing wage laws in New York and elsewhere around the country.

Skilled Trades Employment in the Pipeline Industry: 2006-2015
Pipelines are important to the efficient operation of the U.S. economy, and pipeline construction is an important source of family supporting jobs for construction workers. What then are the economic and job impacts of pipeline construction for the construction trades? This report reviews pipeline jobs data from two principal sources.

Apprenticeships in England: impoverished but laddered
Current discussion among federal policy makers regarding the expansion of the U.S. apprenticeship system draws on the example of apprenticeship expansion in England. Often, this does not reflect a clear understanding of the current English Apprenticeship system. This paper aims to inform federal and state administrative policy makers and legislators, program administrators, and the staff of training and apprenticeship organizations who are interested in understanding the features and performance of the current English system. This paper describes the English apprenticeship system and summarizes current research on the outcomes of that system.

Study of Construction Employment in Marcellus Shale Related Oil and Gas Industry
The purpose of this study was to retrospectively determine the number of full-time equivalent construction jobs created from 2008 through 2013 on natural gas pipeline projects as part of the Marcellus Shale formation in West Virginia, Virginia, Maryland, Pennsylvania, and Ohio.

Prevailing Wage Laws: What Do We Know?
In recent years, states and municipalities have been increasingly engaged in heated, often partisan, debates over the future of prevailing wage laws. In addition to the repeal of state prevailing wage laws in West Virginia and Kentucky, there have been high-profile political challenges in several states including Wisconsin and Nevada. Numerous city councils and county commissioners have been concurrently engaged in similar debates regarding local prevailing wage ordinances. References to economic studies often accompany these calls for legislative action, as advocates on both sides of the debate can point to papers supporting their position. The lack of consensus among researchers, however, is mostly attributable to differences in empirical methodology and scientific rigor. To improve the clarity of future public policy debates on prevailing wage laws, this paper summarizes the current state of research on these policies, highlighting recent academic findings and identifying empirical shortcomings inherent in a number of oft-cited non-academic studies.

Problems with using Occupational Employment Statistics in the Determination of Prevailing Wage Rates
Prevailing wage laws address shortcomings, or what economists call “market failures” associated with the public procurement of construction. The principal motivation of these laws is to protect local labor markets by creating a wage floor to ensure that construction workers will not see their wages and benefits undercut as a result of government spending practices. The infusion of state or federal spending into an area, along with an award process that rewards low bids, may depress wages by attracting contractors from other areas. These contractors may undercut local wage standards by importing lower paid workers or by offering less pay to local workers. The prevailing wage floor protects local construction workers’ pay and benefits and establishes a level playing field for contractors who are bidding on government projects. This report illustrates how the use of Occupational Employment Statistics (OES) in the determination of prevailing wage rates fails to meet this and other goals of prevailing wages.