Biden Labor Department offers new rule on “prevailing wages” that is less accurate

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The Biden Labor Department today announced the issuance of the final rule making changes to Davis-Bacon Act labor regulations, ostensibly aimed at helping construction workers on federal construction projects.

Among other things, the new rule gives regulators more leeway in calculating the prevailing wage – the average wage paid to similarly employed workers in a geographic area – by switching from a wage survey of half of those workers to just a third.

CEI labor policy expert Sean Higgins explains why this change is less about determining the actual prevailing wage and more about politicizing the process:

“The Biden administration’s decision to turn back the clock on Davis-Bacon Act regulations to a Carter administration-era version will benefit a few well-connected unions while raising costs on taxpayers. The administration’s new rule will allow a survey of just a third of workers to calculate the ‘prevailing wages’ to be used when awarding federal contracts. It only takes a basic understanding of math to know that that 30 percent is not a majority and therefore cannot be said to be ‘prevailing’ in any common understanding of the term. Rather this new rule will allow for cherry-picked statistics that result in wage inflation, driving up the costs of those contracts.”