“The examination of the construction labor market and the facts concerning the postures of organized labor, unionized construction, and their political supporters, as well as of the cases in various states, demonstrate that the claimed advantages of government-mandated PLAs are not supported by factual evidence” (Dr. Herbert R. Northup, Journal of Labor Research, Winter 1998).

Construction Costs:

By limiting bidders and forcing construction users to use union workers, pay into union benefit plans, and follow outmoded and inefficient union work rules, union-only PLAs drive up construction project costs. Union-only proponents claim that PLAs reduce construction costs in the long run. There is no credible evidence to support this claim. In reality, union-only agreements create inefficiencies by forcing open shop contractors to adopt unproductive union work practices and use unfamiliar workers.

• A May 2006 study by the Beacon Hill Institute (BHI) at Suffolk University in Boston, Massachusetts, found that the use of PLAs on school construction projects in New York increased the cost of the projects by 20 percent. “Project Labor Agreements and Public Construction Costs in New York State” concluded that the presence of a union-only PLA increased the projects’ base construction bids by $27 per square foot relative to non-PLA projects.
• A September 2004 study by the Beacon Hill Institute (BHI) at Suffolk University in Boston, Massachusetts, completed an extensive statistical analysis of the effects of PLAs on bid and final costs of school construction projects in Connecticut for the period of 1996 through 2004. The study found that PLAs raise the actual or final base construction costs by $30 per square foot (in 2002 prices), representing an almost 18 percent increase in costs over non-PLA projects. BHI concluded that “our key finding is that PLA projects cost more that non-PLA projects, holding the effects of project size and type constant. This is true whether one considers bid costs or final project costs. The effect is statistically significant and robust.”
• A September of 2003 study by the Beacon Hill Institute (BHI) at Suffolk University in Boston analyzed Massachusetts school construction projects and concluded that bid prices on projects with a PLA were an estimated $18.83 per square foot or 14 percent higher than bid prices on non-PLA projects. In addition, the actual cost of construction was 12 percent higher (in 2001 prices) for projects executed with a PLA.
• In September of 2001, the firm of Ernst & Young was commissioned by Erie County in New York to analyze a project labor agreement on the Erie County Construction Project. Ernst & Young concluded that “bidder participation was diminished because the county chose to utilize a PLA. Further, the use of PLAs adversely affects competition for publicly bid projects to the likely detriment of cost-effective construction. Our research revealed that the use of PLAs strongly inhibits participation in public bidding by non-union contractors and may result in those projects having artificially inflated costs.” They went on to say that “there are no apparent valid economic justifications for the continued use of a PLA on Phase II of the Project."
• The Worcester Municipal Research Bureau released their study “Project Labor Agreements on Public Construction Projects: The Case For and Against” on May 21, 2001. The study concluded that “PLAs tend to constrict the number of bidders on a project compared to those without PLAs, and are likely to reduce the savings to the public that would accrue if nonunion contractors who are employed were allowed to follow their customary methods.”
• A study commissioned by the Jefferson County Board of Legislators concluded that “[t]he additional costs estimated with the use of a PLA could range upwards of $955,000. With the loss of even on general contractor from the bidding [as a result of the PLA], the cost increase could approach $200,000.” On this estimated $14 million project, this would mean a cost increase of upwards of 7 percent (September 2000).
• The Clark County School District (CCSD) retained Resolution Management to perform an objective study of the use of project labor agreements on School District Projects. In an independent and unbiased study, they found “no compelling reason for CCSD to enter into PLAs for school construction at this time.
• The Employment Policy Foundation estimates that if all federally-funded government contracts were to include PLAs, the result would be either an increase in the cost of construction by $4.8 billion annually, or a reduction in the amount of federal construction spending by 30 percent (April 1997).
• A study of public-sector PLAs concludes, “While assuring that projects are performed union, they provide little, if any, savings to the [public] owner. In addition, they provide little, if any, competitiveness to the union contractor and may be disruptive to other owners and contractors involved in the local construction market.” It concluded that, “restraints imposed by government-directed PLAs are political decisions which have little or no economic rationale, nor can they be defended on grounds of labor peace, enhanced safety, or other such reasonable criteria.” (Dr. Herbert R. Northrup, Journal of Labor Research, Winter 1998).
• A comparison of bids for a Middletown, Connecticut, school renovation proposal demonstrated a PLA would have added 20 percent to the cost. The town initially issued 72 sets of bid specifications with a PLA, and received only four responses, with the lowest bid ($9.1 million) at $600,000 over the project’s $8.5 million budget. When the project was re-bid without the PLA, it received more than double the number of bids, with the lowest at $7.6 million, producing a savings for the town of $1.5 million.
• A comparison of two stadiums built in Maryland at approximately the same time (Jack Kent Cooke Stadium near Washington, DC and Ravens Stadium in Baltimore), indicates that the cost per seat of Ravens Stadium, built primarily with union labor under prevailing wage laws, was over 13 percent higher than the cost for Jack Kent Cooke Stadium, a merit shop project. Overall, the preliminary results of this study indicate that costs associated with union labor and prevailing wage made the Baltimore stadium costs 4 ½ to 5 percent higher than the Washington stadium.
• A Nevada Water Authority project PLA cost taxpayers an additional $200,000, because the true low bidder refused to sign the PLA. The project then went to a union contractor whose bid was $200,000 higher.
• A study of the taxpayer costs for Roswell Park Cancer Institute in Buffalo, New York, assessed bids for the same project both before and after a PLA was temporarily imposed in 1995. It revealed that there were 30 percent fewer bidders to perform the work and that costs increased by more than 26 percent.
• Another GAO report, issued May 5, 1998, demonstrated that it is nearly impossible to show any savings or increased quality derived from the use of project labor agreements, largely because of the difficulty in finding two identical projects with or without a PLA to study.
• A U.S. General Accounting Office (GAO) report on Department of Energy Idaho Laboratory Project found that the labor costs under the union-only PLA were 17-21 percent above the federally mandated Davis-Bacon rates.

Work Opportunities:

• The U.S. Department of Labor’s Bureau of Labor Statistics (BLS) Jan. 28, 2009 report states that 15.6 percent of the nation’s construction workforce was unionized in 2008. Therefore, since union-only PLAs effectively preclude open shop companies from working as such on a project, PLAs discriminate against the majority of companies and more than eight out of 10 workers who choose not to join a union. These workers’ hard-earned tax dollars fund these projects.
• The District Economic Empowerment Coalition (DEEC) October 2007 Study, “The DC Baseball Stadium Project: Broke Promises, Big Losses for DC Residents” concluded that a PLA signed to ensure local residents the majority of work on the District of Columbia's new $611-million baseball stadium failed to meet hiring goals outlined in the PLA. The study found that the PLA “was intended to produce numerous jobs and opportunities for local residents. Instead, most of the work has gone to residents from outside the city.”
• Ernst & Young’s September 2001 study stated that their “research revealed that the use of PLAs strongly inhibits participation in public bidding by non-union contractors and may result in those projects having artificially inflated costs."
• In his analysis of government-mandated PLAs, Dr. Herbert Northrup concludes, “To exclude or to limit the right of open-shop contractors, who have won 75-80 percent of the national construction dollar spent, from the opportunity to bid on public financed construction, and thus to limit or to eliminate their participation in construction paid for by taxpayers unless they are willing to work as if they were unionized contractors is palpably both unfair and contrary to sound public policy” (Journal of Labor Research, Winter 1998).
• A December 2008 editorial by The National Black Chamber of Commerce described PLAs as “a license to discriminate against black workers.” Likewise, minority and women’s construction, business and employee associations have vocally opposed government mandated union-only PLAs. Testimony from an Aug. 6, 1998 U.S. House Small Business Committee hearing called "The Administration's Policy of Discrimination: Project Labor Agreement's Negative Impact on Women and Minority Owned Small Businesses" highlights the negative impact of PLAs on women and minority owned businesses and their employees. The National Black Chamber of Commerce, Women Construction Owners and Executives and the National Association of Small and Disadvantaged Businesses are among a diverse coalition of groups that have actively opposed PLAs. These groups represent workers that are significantly underrepresented in all crafts of building trades unions. Encouraging PLAs on construction projects will make it even more difficult for minority-owned contractors and their workforce to compete.

Productivity and Quality:

Union-only PLAs do nothing to guarantee better quality, skills, or productivity. Merely having a union status does not guarantee better performance as there is no evidence that union labor is more skilled than open shop. Some of the largest and most successful projects completed every year are built on time and within budget by open shop companies and without PLAs. The union label is not needed for construction to be of top quality. Project quality is determined by sound business practices such as quality project management and is governed by voluminous procurement laws and regulations, project specifications and bonding requirements. Safeguards against shoddy work practices and stiff market competition also prevent unqualified companies from competing on public contracts. Moreover, quality lies with the worker’s individual motivation and performance. There is no evidence that a PLA produces quality construction and is the only method to achieve quality, safe and low cost construction.

• Although building trades unions promote PLAs by claiming open shop contractors do not have the capability of managing very large construction jobs, a study by Dr. Herbert R. Northup concludes that, “the facts demonstrate that open-shop contractors can and do successfully both perform and manage large projects.” (Journal of Labor Research, Winter 1998).
• After performing a thorough study of PLAs in the New York area, Ernst & Young concluded that “[t]here is no quantitative evidence that suggests a difference in the quality of work performed by union or open shop contractors." (September 2001)
• A 2006 study by The Public Interest Institute concludes that a PLA on the Iowa Events Center project in Des Moines placed an “unnecessary burden” on local workers, business and taxpayers. Iowa public officials required a PLA and stated that it was necessary to “keep the project on time, keep it on budget, and complete it in a safe manner.” According to the study, the union-only PLA “failed on all three counts.”

Safety:

Unions claim projects built with a non-union workforce are unsafe and/or union workers are safer than non-union workers. There is no statistical evidence to support this claim. Today’s construction worksites are governed by numerous laws, Occupational Safety and Health Administration (OSHA) regulations and safety procedures designed to protect the safety and health of craftspeople. Jobsite safety is not determined by the labor affiliation of a project’s workforce as the majority of reputable and competitive construction companies employ craftspeople that have completed safety training. Contractor qualification and selection, workforce management and safety programs are more appropriate indicators of a project’s quality and safety performance.

List of Studies:

The DC Baseball Stadium Project: Broke Promises, Big Losses for DC Residents – The District Economic Empowerment Coalition (DEEC) (October 2007)

Project Labor Agreements and the Cost of Public School Construction Projects in New York – Paul Bachman and David G. Tuerck, Beacon Hill Institute at Suffolk University (May 2006)

The PLA for the Iowa Events Center: An Unnecessary Burden on the Workers, Businesses and Taxpayers of Iowa – Public Industry Institute Staff, Mt. Pleasant, IA (March 2006)

Union-Only Project Labor Agreements: The Public Record of Poor Performance – Maurice N. Baskin (2005 edition)

Project Labor Agreements and the Cost of Public School Construction Projects in Connecticut – Paul Bachman, Jonathan Haughton and David G. Tuerck, Beacon Hill Institute at Suffolk University (September 2004)

Project Labor Agreements and the Cost of Public School Construction Projects in Massachusetts – Paul Bachman, Jonathan Haughton and David G. Tuerck, Beacon Hill Institute at Suffolk University (September 2003)

Erie County Courthouse Construction Projects: Project Labor Agreement Study – Ernst & Young (September 2001)

Project Labor Agreements on Public Construction Projects: The Case For and Against – Worcester Municipal Research Bureau (May 2001)

Government-Mandated Project Labor Agreements in Construction: The Institutional Facts and Issues and Key Litigation: Moving Toward Union Monopoly on Federal and State Financed Projects. Government Union Review, Volume 19, Number 3. Herbert R. Northrup and Linda E. Alario. (October 2000)

Analysis of the Impacts on the Jefferson County Courthouse Complex through Project Labor Considerations – Prepared for the Jefferson County (NY) Board of Legislators – Professor Paul G. Carr, P.E., Engineering and Management Consultant (September 2000)

Project Labor Agreement Study: Prepared for Clark County (NV) School District – Resolution Management (June 2000)

Government-Mandated Project Labor Agreements in Construction: A Force to Obtain Union Monopoly on Government-Financed Projects. Herbert R. Northrup, The Wharton School. (January 2000)

“Boston Harbor”-Type Project Labor Agreements in Construction: Nature, Rationales and Legal Challenges – Journal of Labor Research. Herbert R. Northrup and Linda E. Alario. (Winter 1998)

Project Labor Agreements: The Extent of Their Use and Related Information – GAO Report (May 1998)

Comparison of Nonunion and Union Contractors Construction Fatalities – National Center for Construction Education and Research (May 1995)

Analysis of Bids and Costs to the Taxpayer for the Roswell Park Cancer Institute, New York State Dormitory Authority Construction Project –Associated Builders & Contractors – Empire State Chapter (March 23, 1995)