How do wages and spending compare among the best states for merit-shop construction?
By Larry StewartDecember 19, 2022
For the fourth time, Florida claimed the top spot in Associated Builders and Contractors’ eighth annual Merit Shop Scorecard, a ranking of all 50 states and the District of Columbia based on policies that advocate for merit-shop competition on taxpayer-funded construction projects, strengthen career pathways in construction and encourage workforce development.
Four of the seven criteria ABC applies to rank each state are the state’s position on project-labor agreement mandates, prevailing wage, right-to-work legislation and public private partnerships.
In addition to fostering merit-shop competition in public construction work, Florida continues to reap the benefits of providing students with many career pathways, which in 2022 yielded a graduation rate of 96% for students in career and technical education programs.
Bureau of Labor Statistics data shows the mean hourly construction wage in Florida is $17.25 per hour, and the mean hourly wage for construction labor in the 11 of the 12 states that ABC’s Merit Shop Scorecard awarded an A grade is well below the national mean of $21.22. The lone standout is Wisconsin, where the mean construction wage is $21.89. None of the A grades on the scorecard coincided with a state that ranks near the top of the list of best construction wages adjusted for state cost of living.
Nine of the 12 states at the bottom of the Merit Shop Scorecard (none have right-to-work laws and few offer scant protection from project labor agreements or prevailing wages) rank among the 10 states with the highest average pay for construction workers, and four of them are among the Top 10 states in construction pay adjusted for cost of living.
Arizona followed Florida in second place on ABC’s ranking this year. ABC says the state has benefitted from a strategic focus on its workforce and its students, satisfying 98% of the labor demand in the state and graduating 92% of its CTE students.
Rounding out the top five, Georgia ranked third, Alabama fourth and Arkansas fifth. Other states to receive an A grade in 2022 include South Carolina, Kentucky, North Carolina, Oklahoma, Utah, Wisconsin and West Virginia, in order by rank.
Of note, Alabama jumped from 15th in 2021 to fourth this year after investing $200 million in workforce development. Similarly, Oklahoma climbed to ninth this year, up from 20th in 2021, after increasing its workforce development investment.
The association’s analysis calls out Michigan’s drop in the 2022 rankings, which fell nine spots in ABC’s estimation, “because Gov. Gretchen Whitmer reinstated prevailing wage via executive order.” Michigan did, however, rank 14th among states according to the average annual value of state and local construction put in place there over the past 15 years.
Adding together the average annual value of construction put in place in the dozen states that ranked lowest on the Merit Shop Scorecard equals an amount 93% greater than aggregate construction spending among the 12 states at the top of the Merit Shop Scorecard.