Yesterday’s coverage of the collision course between California’s housing recovery and the state legislature’s efforts to map very possibly all residential construction labor to prevailing wage rates struck a chord.
The article, “California Scheming: The Prevailing Wage Caper,” generated a great deal of activity on our site, and hopefully, led to traffic to the Care About Housing site, where people can gather information, and if they choose, take action to show support to oppose Assembly Bill 199.
Obviously, not everybody agrees with the point of view or opinions I voiced in yesterday’s piece. This is no surprise. What a polarized time we live in!
I should note that my opinion–that AB 199 is misguided legislative overreach that could more than likely do harm to many of the Californians its proponents say they’re trying to protect and help–bases itself on two foundational assumptions.
One is that making builders pay more to build homes and communities makes those homes and communities cost more to those who intend to buy and live in them. The other concerns current wages of subcontractors and trade crews working on residential job sites today. The fact that such unskilled, semi-skilled, and skilled labor is in such tight supply that it constrains capacity to complete homes in more and more markets, leads me to assume that those workers do not need to suffer unfairly low pay in any single project. They’re able, even within close geographical range, to choose to work where the pay will be greatest, among builders and developers who are fairly competing not only with one another, but for laborers.
So, the fact that California is undersupplied in new housing, and that that lack of supply takes the form of scarcity, driving up prices, and making the limited inventory more expensive, is the reason it’s my opinion that legislative engineering of workers’ wages on job sites will only serve to cause builders to go to other markets to operate, where they can do so profitably.
This will take work away. This will take away the multiplier effect that new home building generates in local communities, among local retailers, appliance sellers, financial institutions, and other businesses. This will also make housing so expensive that only the very wealthy, already resident property and power holders can sustain living there.
Again, these convictions stem from those two assumptions I mention above. And, as I said, not everybody agrees.
I had a note yesterday from someone in the audience whose reading of my views calls them both heartless and elitist. I believe it’s important for the BUILDER audience to hear this side of the argument, because this is the voice of those in support of AB 199 as a measure that would protect, not harm, workers’ interests. Here it is:
Dear Mr McManus,
I am sorry to hear that you do not support the well being of the workers that build these California homes. If there is ANY governmental financial support that helps to fund a project or development, it is likely that these workers are helping to pay for the project through the taxes that they pay. Therefore, they should be worthy of a liveable & sustainable wage to take care of themselves & their families. Your opposition to the prevailing wage seems to be more about the profits of the builders than it is about the affordability of homes in California. Most construction workers cannot afford to purchase a new home, let alone purchase any home for themselves. California is like an island, with its own economy, with much higher costs for everything than the US average. The working class needs a voice too, and needs a share of the income from the economy in order to participate in it- or is that what you’re supporting, to get rid of the working class? You come off as an elitist in this editorial as you are ignoring the fact that realistically, an economy needs all levels of workers to make a liveable wage, and that does require the wealthy to share, in the form of good wages. If the wages were actually sustainable, Assemblyman Chu would not be taking this matter up.
Thanks for your time,
We live in such complex times.
Your thoughts are welcome. Maybe, however, we can keep the name-calling to a minimum and try to tie comments to facts. Thank you.
