Prevailing wage laws and construction labor markets

Prevailing wage laws, which require that construction workers employed by p rivate contractors on public projects be paid wages and benefits at least e qual to those "prevailing" for similar work in or near the locality in whic h the project is located, have been the focus of an extensive policy debate . The authors, analyzing Current Population Survey data and Census data, fi nd that the relative wages of construction workers decline slightly after t he repeal of a state prevailing wage law. However, the small overall impact of law repeal masks substantial differences in outcomes for different grou ps of construction employees. Repeal is associated with a sizable reduction in the union wage premium and an appreciable narrowing of the black/non-bl ack wage differential for construction workers.