Congressman Bishop-Talking Points

April 14, 2011

GAO Report Leaves a Mistaken Impression about How Frequently Union Rates Prevail

Mr. Sherrill, the GAO report (p. 20) says that, Of Labors published wage rates as of
November 12, 2010, about 63 percent were union prevailing; in contrast, about 14
percent of construction workers nationwide were represented by unions in 2010,
according to BLS figures.

That statement conflicts with the testimony of John Fraser, Department of Labors
Acting Wage and Hour Administrator, under questioning in this committee on June 30,
1997. The testimony in 1997 before this committee was that 29% of wage
determinations were the union collective bargaining agreement rate.

Its my understanding that GAOs conclusion can only be reached, Mr. Sherrill, if one
examines every subclassification within every trade around the country. Its my
understanding that, particularly where unions prevail their rates, that there tend to be
numerous subclassifications. In areas where non-union wage rates prevail, there tends
to be just one wage rate for what DOL calls a key classification. Rather than
comparing what DOL calls a key classification to key classification your method leaves
Congress with the impression that unions prevail their rates in far more areas around
the country than they actually do. If one collapses all the subclassifications into key
classifications, the numbers flip around. That is to say, DOLs testimony from 1997
accurately reflects the prevalence of non-union wage rates, where over 2/3rd of wage
rates are actually non-union wage rates. To accurately ascertain the number of wage
determinations which are, in fact, based upon union rates, the method for counting
them must be consistent for both union and non-union wage determinations. The GAO
study should have compared key classification to key classification.

DOLs assertion that less than 30% of wage rates are union comports with anecdotes,
too. There are many, many states where you wont find a single union collective
bargaining agreement prevailing in the highway sector that segment of the
construction industry which is most likely to be unionized. Thats true for states like
South Carolina, Mr. Gowdy, and South Dakota, Ms. Noem. Its also true for Oklahoma,
New Mexico, North Carolina, Vermont, and others. Obviously, that only makes sense.
Unions arent strong in right-to-work states like South Carolina in Mr. Gowdys district.

Its worth pointing out that, while only 14% of workers in the whole construction
industry are represented by a union, the percentage is far higher in the types of
construction that tend to be funded with public investments big highway projects, for
example. Big commercial, industrial, and highway projects are much more likely to be

union than a residential project, where there is very little union presence except in
some of the nations biggest metro areas. And, as the Davis-Bacon Act takes into
consideration, there is a dramatic variation between labor markets from one area to
another. Very little highway construction work is performed by union members in South
Carolina. Whereas virtually all of the highway work in my Congressional district is
performed by union members.

Im concerned about this piece of your report, Mr. Sherrill. I think it leaves the wrong
impression for reviewers of the study, and it leads some of my colleagues on the
committee to reach specious conclusions about the role of the Davis-Bacon Act in local
construction labor markets.