Common construction wage - how it works

What is it?

Indiana’s Common Construction Wage Act establishes labor rates in construction projects contracted by state and local government. It ensures that government does not upset the market equilibrium commanded by the private sector.



Indiana’s law arose in the 1930s as a response to operators from the South undercutting Indiana contractors with cheaper, less-skilled labor.



The premise is that government should not use its massive buying power to upset local markets and erode construction wages. A community is better off in the long run with a local population of skilled construction workers who receive decent wages, health care and retirement benefits for themselves and their families.


What if?

So … what if the Common Construction Wage Act is repealed? Recent studies indicate:

  • Cost remains the same.
  • Build quality suffers.
  • Safety goes down.
  • Diversity is diminished.
  • Training is inadequate or absent.
  • Health care and pensions are inadequate or absent.


The bottom line.

Indiana’s law encourages skills formation and a reliable and scalable construction workforce. By protecting wages and benefits in local areas, the law helps all Hoosier workers.