Davis-Bacon: The Act and the Literature

Davis-Bacon: The Act and the Literature
Updated November 13, 2007
William G. Whittaker
Specialist in Labor Economics
Domestic Social Policy Division
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Davis-Bacon:
The Act and the Literature
Summary
The Davis-Bacon Act of 1931, as amended, requires that contractors engaging
in certain federal contract construction pay workers on such projects not less than the
locally prevailing wage for comparable work. In addition, such contractors are
required to file payroll reports and to meet other administrative and labor standards
requirements.
Enacted at the urging of the Hoover Administration, the statute was modified
in 1934 with adoption of the Copeland (“anti-kickback”) Act and in 1935 through
general amendments dealing with administration and implementation: among them,
establishment of a $2,000 coverage threshold (the threshold had been $5,000 in the
original enactment), a requirement that the prevailing wage rate be determined prior
to submission of bids, and extension of coverage both to public buildings and public
works including painting and decorating. In 1964, the concept of “prevailing wage”
was expanded to include a fringe benefit component. The statute has also been the
subject of technical amendments through the years, and Davis-Bacon provisions have
been added to more than 50 federal program statutes.
The act contains a provision allowing for its suspension by the President of the
United States during a “national emergency.” It has been suspended on three
occasions: in 1934 by President Roosevelt, in 1971 by President Nixon, and in 1992
by President Bush. In each instance, the suspension was brief and the act was
subsequently restored to its full strength.
While there is a relatively extensive literature (both popular and scholarly)
concerning the act, there also appear to be significant gaps in our knowledge of the
statute and its impact. Some have questioned the adequacy of the data upon which
analysis of Davis-Bacon impact rests. During the Reagan Administration, changes
were instituted in the manner in which the act was implemented and these, in turn,
have produced a need for further, more current, data for analytical purposes.
Included, here, is a select bibliography of published materials dealing with the
Davis-Bacon Act and immediately related issues. The list includes popular and
scholarly sources but does not, for the most part, include an inventory of
congressional documents, agency reports or publications of interest groups. Most of
the documentation cited here will be available from the collections of the Library of
Congress or from major public or university library collections. In some cases,
privately published materials are available through the Internet. This bibliographic
report will be updated periodically.
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Contents
The Davis-Bacon Act of 1931 (As Amended)............................1
Origins of the Act..............................................2
A Gradual Process of Evolution..................................3
Early Modification.........................................3
A Period of Growing Contentiousness.........................5
Getting to Know the Davis-Bacon Act, Pro and Con.....................10
Arguments Generally Critical of Davis-Bacon......................10
Arguments Generally Supportive of Davis-Bacon....................11
How Good is the Information We Have Concerning the Effects of the
Davis-Bacon Act?............................................11
The General Nature of Davis-Bacon Research......................12
Significant Gaps..............................................13
Some Agency Studies.....................................13
Views from the Private Sector...............................14
Bibliography.....................................................18
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Davis-Bacon: The Act and the Literature
The Davis-Bacon Act (40 U.S.C. §§ 276a-276a-5, now re-codified as 40 U.S.C.
3141-3148) became law in 1931. As amended, the act requires that construction
contracts entered into by the federal government specify minimum wages to be paid
to the various classes of laborers and mechanics working under those contracts.¹
Minimum wages are defined by the act as those determined by the Secretary of Labor
(a) to be prevailing (b) in the locality of the project (c) for similar crafts and skills (d)
on comparable construction work. The prevailing wage concept was expanded in
1964 to include a fringe benefit component. The act has a coverage threshold of
$2,000.
Through the years, Davis-Bacon prevailing wage provisions have been added
to more than 50 program statutes. In addition, many states and some local
jurisdictions have “little Davis-Bacon” acts of their own. Most of these differ from
each other in coverage or other requirements — and differ, as well, from the federal
statute.
This report sketches the evolution of the Davis-Bacon Act and suggests the
scope of the controversy that has formed around it. It then examines, briefly, some
of the trends in the scholarship and reportage concerning the act and, finally, provides
a bibliography of published non-documentary sources that are generally available to
persons with a deeper interest in the statute, its history, and its administration.
The Davis-Bacon Act of 1931 (As Amended)
Early in the 20^th century, it was not at all clear that the federal government had
the authority to regulate wages and conditions of work in the private sector.² When
Congress attempted to deal legislatively with hours of work, child labor or minimum
wages, its enactments were often found by the courts to be in violation of its
constitutional authority. Only after 1937 when the U.S. Supreme Court sustained a
¹ Alongside the Davis-Bacon Act are two other, different, statutes governing labor standards
in federal contracts for goods and services respectively: the Walsh-Healey Act (1936), 41
U.S.C. 35-45; and the McNamara-O’Hara Service Contract Act (1965), 41 U.S.C. 351-358.
These laws are supplemented by other federal statutes that deal with hours of work and
health and safety standards.
² About this period, see Irving Bernstein, The Lean Years: A History of the American
Worker, 1920!1933 (Boston: Houghton Mifflin, 1960); Louis D. Brandeis, “The
Constitution and the Minimum Wage,” The Survey, February 6, 1915, pp. 490-494, and 521-
524; Robert H. Zieger, Republicans and Labor, 1919!1929 (Lexington, Ky.: University of
Kentucky Press, 1969); and Broadus Mitchell, Depression Decade: From New Era Through
New Deal, 1929-1941 (New York, Rinehard & Company, Inc., 1960).
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Washington state labor standards statute (West Coast Hotel v. Parrish (300 U.S.
379)) did Congress assume a more confident affirmative role in regulation of the
workpl ace. ³
Origins of the Act
If government found its role in the private sector somewhat circumscribed by
the courts, it was on was on firmer constitutional ground in prescribing labor
standards for its own direct employees.⁴ Thus, public employees, both federal and
those in state and local government, were often protected by mandated minimum
wage and overtime pay standards.
But, while their own employees were protected, some public agencies sought
to circumvent these requirements (and to expand their purchasing power) by
“contracting out” for construction, goods and services. This caused some reformers
to protest that the various units of government ought to provide a better example of
fairness for private sector employers.
In 1891, Kansas adopted a law requiring that “not less than the current rate of
per diem wages in the locality where the work is performed shall be paid to laborers,
workmen, mechanics, and other persons so employed by or on behalf of the state of
Kansas” or of other local jurisdictions. Through the next several decades, other
states followed suit, enacting a variety of labor-protective statutes covering workers
in contract production.⁵
Federal contracting practice, into the 1930s, required that “the lowest
responsible bid” be accepted. In this instance, responsibility referred to a reasonable
expectation that a project could be completed in a timely fashion without regard for
the wages paid to workers or the conditions under which they worked. This “made
the government an unwilling collaborator with unscrupulous firms that sought to get
government business by cutting wages.”⁶ In the construction field, it was alleged that
migratory contractors from low-wage sections of the country would bid for federal
work and, because they paid wage rates lower than those prevailing in the locality of
³ John W. Chambers, “The Big Switch: Justice Roberts and the Minimum Wage Cases,”
Labor History, winter 1969, pp. 44!73. The Fair Labor Standards Act, the basic federal
statute dealing with minimum wages, overtime pay and child labor, was enacted in 1938 —
seven years after Davis-Bacon became law.
⁴ Concerning early labor standards protections for public employees, see Marion Cotter
Cahill, Shorter Hours: A Study of the Movement Since the Civil War (New York: Columbia
University Press, 1932); Sidney Fine, “The Eight-Hour Day Movement in the United States,

1888!1891,” The Mississippi Valley Historical Review, December 1953, pp. 441!462; and,

a proposed project (and employed nonresident workers), they enjoyed a competitive
advantage over “fair” local contractors.
In 1927, Representative Robert L. Bacon (R-NY) introduced legislation to
require that locally prevailing wage standards be met in federal construction work.
Although hearings were conducted, the legislation was not brought to the floor.
Similar legislation was introduced in 1928 and again in 1930. Finally, in March
1931, at the urging of the Hoover Administration, the Bacon Act (co-sponsored by
Senator James Davis (R-PA), formerly Secretary of Labor in the Harding, Coolidge
and Hoover Administrations) was passed and signed by President Herbert Hoover.
A Gradual Process of Evolution⁷
Almost immediately after its adoption, certain deficiencies in the Davis-Bacon
Act became apparent. Both industry and organized labor, while voicing different
concerns, appealed to the Congress and to the White House for revision of the statute.
Early Modification. While mandating under Davis-Bacon that not less than
the locally prevailing wage be paid, Congress had not established a regular system
though which such wage rate determinations might be made. Thus, contractors,
when bidding on a public project, had to commit themselves to pay whatever wage
could be agreed upon or, in the event of a dispute, whatever wage the Secretary of
Labor might later decide was prevailing. Thus, industry sought amendment of the
act to provide for predetermination of wage rates.
Organized labor was concerned that enforcement procedures under the act were
inadequate. Pointing to the $5,000 threshold for triggering the statute, it noted that
certain employers might fragment contracts in order to escape the act’s requirements.
Besides, the unions suggested, many contracts for painting and decorating fell below⁸
the threshold and thus, workers in those fields would not be covered at all.
It was alleged that some employers paid the locally prevailing rate to their
employees as the act required, but would then demand, under the table, a “kick-back”
of a portion of that wage. Some estimated that as much as 25% of the legitimate
wage costs for federal projects was being returned to employers through kick-back⁹
arrangements.
⁷ A more extensive historical overview of the act appears in CRS Report 94-408, The Davis-
Bacon Act: Institutional Evolution and Public Policy, by William G. Whittaker.
⁸ Armand J. Thieblot, Jr. The Davis-Bacon Act (Philadelphia: The Wharton School,
University of Pennsylvania, 1975), p. 11.
⁹ U.S. Congress, Senate Subcommittee of the Committee on Education and Labor,
Investigation of the Relationship Existing Between Certain Contractors and Their
Employees in the United States, hearings on S.Res. 228, 73d Cong., 2d sess., Part 1, May

4, 7, and June 21, 22 and 23, 1934 (Washington, U.S. Govt. Print. Off., 1934), p. 3.

Executive Order No. 5778 (1932). Under pressure both from labor and
employers, Congress commenced oversight hearings on the recently adopted statute
in January 1932; but, just as the hearings began, President Hoover issued Executive
Order No. 5778, generally strengthening the enforcement and administration of the¹⁰
act. Since the Hoover reforms, a fine tuning of implementation of the statute, had
been achieved through administrative action and, thus, could be reversed at will by¹¹
a later President, Congress pressed forward with legislative action. But, when the
legislation reached the President’s desk in July 1932, Mr. Hoover vetoed the bill, his
Labor Secretary, William Doak, observing that the measure “would be impracticable
of administration” and “would stretch a new bureaucracy across the country.”¹²
The Copeland “Anti-Kickback” Act (1934). Congressional hearings on
public contracting issues continued through the next several years. With support
from the Roosevelt Administration, legislation authored by Senator Royal Copeland
(D-NY) was called up in the Senate (April 26, 1934) and, after a brief statement by
the Senator, passed.¹³ The House proceeded in a similar fashion, acting without
debate. On June 13, 1934, President Franklin Roosevelt signed the measure. The
Copeland “anti-kickback” Act provided a fine and/or imprisonment for anyone who
induces any person engaged in federal or federally financed construction “to give up
any part of the compensation to which he is entitled under his contract of
employment.” The act authorized the administering agencies to “make reasonable
regulations” for its enforcement, but specifically required that “each contractor and
subcontractor shall furnish weekly a sworn affidavit with respect to the wages paid
each employee during the preceding week.”¹⁴
The Davis-Bacon Amendments of 1935. By the spring of 1935, Senator
David Walsh (D-MA) had drawn up general Davis-Bacon amendments, designed to
address perceived administrative problems. The Davis-Bacon amendments of 1935
reduced the threshold for coverage from $5,000 to $2,000. They provided coverage
for all federal contract construction of whatever character to which the United States
and the District of Columbia might be a party: “construction, alteration, and/or
repair, including painting and decorating, of public buildings or public works.”
Henceforth, bids for contracts covered by Davis-Bacon were to state “the minimum
wages to be paid various classes of laborers and mechanics,” thus establishing a
requirement of predetermination of the wage rates. The Comptroller General was
directed to prepare a list of contractors who had “disregarded their obligations to
employees and subcontractors” with such violators of the Davis-Bacon/Copeland
¹⁰ U.S. President (Hoover), Executive Orders, 5735-6070, October 1931-March 1933,
collected set, bound by the Library of Congress.
¹¹ Congressional Record, June 8, 1932, pp. 12363!12390; and June 20, 1932, p. 13471.
¹² Public Papers of the Presidents of the United States: Herbert Hoover, 1932-1933,
(Washington, U.S. Govt. Print. Off., 1977), p. 286.
¹³ Congressional Record, April 26, 1934, p. 7401.
¹⁴ Congressional Record, June 7, 1934, p. 10759.
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provisions to suffer potential debarment from further federal contracts for a period
of up to three years. Other administrative provisions were also included.¹⁵
A Period of Growing Contentiousness. For a period of about 20 years
following adoption of the 1935 Davis-Bacon Act amendments, the act appears to
have attracted little attention.¹⁶ Then, in the mid-1950s, Congress began,
increasingly, to add Davis-Bacon provisions to program statutes, triggering debate
over both the substance and application of the act.¹⁷ Defense construction and the
new space program brought the act into renewed prominence during the early 1960s
and, since that time, it has remained more-or-less continuously a focus of
congressional interest.
The Roosevelt Subcommittee (1962-1964). In 1962, a Special
Subcommittee of the House Committee on Education and Labor was assigned the
task of general oversight of Davis-Bacon Act — by this point, three decades old —
and the related contract labor standards statutes. Chaired by Representative James
Roosevelt (D-CA), the Subcommittee conducted the most extensive review of the act
since the mid-1930s.
In addition to general operation of the statute, the Roosevelt Subcommittee
focused specifically upon the following areas: (a) how Davis-Bacon wage rate
determinations are made and the extent to which they are an accurate reflection of
wage rates that actually prevail, locally, in the area of construction; (b) whether a
system of review of Davis-Bacon wage rate determinations and related decisions of
the Department of Labor might be needed; and (c) “any other constructive proposals”
for the improvement of the act and of its administration.¹⁸ The work of the
Subcommittee resulted in enactment of the 1964 “fringe benefit” amendment to the
act which expanded the prevailing rate concept from the cash wage alone to both
¹⁵ Congressional Record, July 30, 1935, pp. 12073!12074; August 23, 1935, p. 14384; and,
August 30, 1935, p. 14753. See also U.S. Congress, House Committee on Labor, Amend the
Act Approved March 3, 1931, Relating to Rate of Wages for Laborers and Mechanics
Employed on Public Buildings, report to accompany S. 3303, August 9, 1935 (Washington,
U.S. Govt. Print. Off., 1935), p. 1.
¹⁶ Letter to Leaders of Labor and Management in the Building and Construction Industry,
Public Papers of the Presidents of the United States: Harry S. Truman, January 1 to
December 31, 1947 (Washington, U.S. Govt. Print. Off., 1963), pp. 117!118.
On June 5, 1934, the Davis-Bacon Act was suspended by President Franklin Roosevelt,
apparently in order to avoid confusion with other New Deal statutes. On June 30, 1934, the
act was quietly restored. See John Herling’s Labor Letter, March 13, 1971, p. 3; Statutes
at Large, vol. 48, part 2, pp. 1745-1746, and vol. 49, part 2, p. 3,400.
¹⁷ U.S. Congress, House Committee on Public Works, Federal Highway and Highway
Revenue Acts of 1956, report to accompany H.R. 10660, H.Rept. No. 2022, 84^th Cong., 2d
sess. (Washington, U.S. Govt. Print. Off., 1971), p. 13.
¹⁸ U.S. Congress, House Committee on Education and Labor, Special Subcommittee on
Labor, Administration of the Davis-Bacon Act, hearings, 87^th Cong., 2d sess., Part 1, June
6, 7, 8, 11 and 12, 1962 (Washington, U.S. Govt. Print. Off., 1962), p. 1. (Hereafter cited
as House Subcommittee on Labor, Administration of the Davis-Bacon Act.)
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cash and fringe benefits — or the value of the latter.¹⁹ Further, indirectly, it may have
encouraged the Secretary of Labor, Willard Wirtz, to create within the Department
in 1964 the Wage Appeals Board to hear Davis-Bacon cases.²⁰ But, there were no
broad changes in the act comparable to those of 1935.
The Subcommittee, however, exposed what appears to have been a jurisdictional
clash between the General Accounting Office (recently renamed Government
Accountability Office) (GAO) and the Department of Labor (DOL) with respect to
Davis-Bacon. Spokespersons for GAO, testifying before the Subcommittee, were
openly critical of the Department’s administration of the act.²¹ In the wake of the
hearings, there followed, between 1962 and 1971, a series of eight separate GAO
reports that urged reform of the administration of the act and that seemed to argue
that Davis-Bacon might be ill-advised as public policy. How seriously GAO’s
perspectives were taken is not entirely clear, but Congress continued to support the
act and to extend its provisions as various construction-related measures were
adopted.
The Nixon Suspension of Davis-Bacon (1971). The authors of the
Davis-Bacon, in 1931, had included a provision which allows the President, “[i]n the
event of a national emergency,” to suspend the act. The concept of “national
emergency” was not defined nor were the conditions under which a suspension might
occur. In 1934, President Franklin Roosevelt had suspended the act for three weeks,
apparently for purposes of administrative convenience related to operation of the
various New Deal enactments of that period. The Nixon suspension of Davis-Bacon
(1971) occurred within the context of the President’s campaign to bring inflation
under control.
In 1970, President Richard Nixon was engaged in an effort to curb inflationary
pressures — notably within the construction industry. He had conferred both with
industry and trade union officials urging moderation in wage/price matters but,
apparently, without entire success. In that context, on February 23, 1971, President
Nixon suspended the Davis-Bacon Act and suspended, as well, the Davis-Bacon
provisions that had been incorporated by Congress in the various federal program
statutes. His action raised a number of issues, some of them legal, and gave the
Davis-Bacon Act renewed visibility. A month later, on March 29, 1971, the
President restored the act, unchanged, but also established a tripartite Construction²²
Industry Stabilization Committee as part of his wage/price control apparatus.
¹⁹ Congressional Quarterly Almanac, 1964, Congressional Quarterly, Inc., Washington,

1965, pp. 576!577.

319!322, and 325!454.

Administrative Clashes Over Davis-Bacon. Through the 1970s,
administrative conflict over Davis-Bacon (and efforts to reform or to repeal the act)
grew more intense. With the diverse character of federal programs (in construction,
goods and services), a need arose for better operational coordination of various
statutes and regulations, among them the federal contract labor standards statutes. In
reorganization plans set forth in 1947 and 1950, the Truman Administration had
attempted to establish, clearly, responsibility for administration of the Davis-Bacon
Act; but that initiative notwithstanding, interagency disputes with respect to Davis-
Bacon (and the related Walsh-Healey and McNamara-O’Hara Acts) appear to have
continued.
During the Ford and Carter Administrations, these interagency disputes
continued intermittently, involving the Department of Labor, the several contracting
agencies, the Office of Management and Budget, and GAO. Further, interest groups,
journalists and political pundits lined up on each side of these conflicts — and,
ultimately, these matters, essentially administrative, became the focus of
congressional hearings. In turn, the hearings generated further public comment and
reaction both from defenders and from critics of the act.
The 1979 GAO Report. Amid interagency squabbles and industry criticism
of the act, a new report appeared from the General Accounting Office. The 1979
GAO report was titled simply, The Davis-Bacon Act Should Be Repealed.²³
Immediately controversial, the report reviewed GAO’s longstanding criticism of the
DOL’s administration of the act. Through the summer of 1979, the report and the
issues it raised became the focus of three congressional hearings — though no
legislated revision of the act was passed. Perhaps as important as legislation,
however, the GAO report (with the hearings record) provided a body of material from
which critics of the act would draw through the next decade and beyond.
Influenced in part by the GAO report and by the attention that it had focused
upon Davis-Bacon issues, the DOL (late in the Carter Administration) proposed
certain changes in the administration of the act. But, in practical terms, these
proposals came too late. Published on January 16, 1981, they would have taken
effect on February 14, 1981 — by which point a new Presidential administration had
assumed control. The proposals for reform of the Davis-Bacon Act, issued by the
Carter Administration, were promptly withdrawn by President Reagan.²⁴
Administrative Reform Under President Reagan. Building from the
foundation laid down by the Carter Administration, the Reagan Labor Department
proposed a new body of Davis-Bacon reforms in August 1981, calling for public
comment.²⁵ Final regulations were issued in May 1982 to take effect in July of that
year. Labor Secretary Raymond Donovan affirmed that “the final rule should be very
²³ U.S. General Accounting Office, The Davis-Bacon Act Should Be Repealed, Report to the
Congress by the Comptroller General of the United States, HRD-79-18, April 27, 1979. 115
p. (Hereafter cited as GAO, The Davis-Bacon Act Should Be Repealed.)
²⁴ Federal Register, December 28, 1979, p. 77026; and January 16, 1981, p. 4306.
²⁵ Federal Register, August 13, 1981, p. 41428.
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well received by contractor groups.” He also acknowledged that “labor may react
unfavorably.”²⁶ He was right on both counts. Trade union leaders were “shocked
and angered” and viewed the regulations as a “back door attempt to nullify the law.”²⁷
Industry sources, noting that they had been “working for years to abolish or amend
the Davis-Bacon law and the regulations that implement it” termed the Reagan
regulations “a major improvement.”²⁸
Essentially, the Reagan regulations simplified the wage rate determination
procedures, weakened or streamlined (depending upon one’s perspective) the
reporting requirements of the Copeland “anti-kickback” Act, and would have allowed
increased flexibility in the employment of “helpers” (persons not necessarily
possessing craft training) on Davis-Bacon projects. Litigation extended into the Bush
Administration. At large, the courts acceded to the Secretary of Labor’s discretion
in wage rate determination. However, the Department was instructed to restructure
its Copeland Act proposals and those dealing with the use of helpers. That process
has not yet resulted in final regulatory change. Meanwhile, some have argued that
the Reagan reforms, like those instituted by President Hoover 50 years earlier, are
vulnerable to further change, administratively, and therefore ought to be codified in
st at ut e. ²⁹
The Bush Suspension of Davis-Bacon (1992!1993). Davis-Bacon
critics had, through the years and for a variety of reasons, urged that the act be
suspended by Presidential decree — as the President has the authority to do within
the context of a “national emergency.” During the winter and spring of 1992, that
action was urged upon George Bush but, by early summer, the issue had faded from
public view.
Then, on October 14, 1992, President Bush suspended Davis-Bacon as applied
in parts of the states of Florida, Louisiana and Hawaii. The three states had been
battered by hurricanes and President Bush declared the resulting destruction an³⁰
emergency for purposes of suspending Davis-Bacon. The suspension, he affirmed,
could create “as many as five to eleven thousand new jobs in the construction
industry in these states” and he noted further that payment of the locally prevailing
wage in the storm-damaged areas would “increase the costs” of rebuilding. Critics
argued that the suspension was not justified. The suspension was open-ended — to
²⁶ Bureau of National Affairs, Daily Labor Report, May 28, 1982, p. A6. (Hereafter cited
as DLR.)
²⁷ DLR, May 27, 1982, pp. A1 and F1.
²⁸ Washington Report, United States Chamber of Commerce, June 8, 1982, pp. 1 and 20.
²⁹ See U.S. Library of Congress, Congressional Research Service, Davis-Bacon Act and New
Department of Labor Regulations, typed and unnumbered report by Vincent Treacy, January

18, 1985. 6 p.

remain in effect until President Bush or his successor restored the act.³¹ On March

6, 1993, President William Clinton did restore the statute to its full force.³²

Gulf Coast region, President George W. Bush suspended the Davis-Bacon Act as it
relates to specific segments of the country: that is, to portions of Florida, Alabama,
Mississippi, and Louisiana. He specified both the act and “the provisions of all other
acts providing for the payment of wages, which provisions are dependent upon
determinations by the Secretary of Labor” under the Davis-Bacon rules, would be
suspended. The suspension would continue “until otherwise provided.” However,
the Davis-Bacon Act would remain in effect throughout the remainder of the nation.³⁶
On October 26, the White House announced that the suspension of the act
would be lifted as of November 8, 2005. But, the Washington Post stated,
reinstatement of Davis-Bacon “will not apply retroactively.”³⁷
Getting to Know the Davis-Bacon Act, Pro and Con
Through the years, arguments for and against Davis-Bacon have become largely
fixed — as have the counter-arguments of defenders and critics. The logic and many
of the assumptions that these arguments contain have been questioned at length. In
the evolving debate, few contentions about the act have gone (or are likely to go)
unchallenged.
Arguments Generally Critical of Davis-Bacon
Some critics of Davis-Bacon argue, among other things, that the act has an
inflationary impact (unnecessarily increasing the cost of federal construction) and
that it hampers competition — especially with respect to small and minority-owned
businesses unfamiliar with federal contracting procedures. They contend that it
impedes efficient utilization of manpower, limiting the use of “helpers” or general
utility workers. Some argue, were Davis-Bacon restrictions absent, that contractors
would employ more minority and women workers because they can hire them more
cheaply and, by fragmenting the tasks to be performed, use them as substitutes for
more broadly skilled workers. Implicit, here, is the assumption that if employers are
forced by Davis-Bacon to pay not less than the locally prevailing wage in a craft, they
will hire more broadly skilled, highly trained, or experienced workers.
Besides, critics note, Congress has provided a general minimum wage floor with
enactment of the Fair Labor Standards Act (1938). They argue that a “super
minimum wage” for federal construction work is both unnecessary and unjust. They
assert that labor costs for federal construction could be reduced (with savings for the
taxpayer) if actual local market wages were paid rather than administratively
determined locally prevailing wages (often the union rate, some argue). In addition,
they urge simplification of the Copeland Act reporting requirements and of the
compliance and wage rate determination process.
³⁶ See White House press release, September 8, 2005.
³⁷ Griff Witte, “Prevailing Wages To Be Paid Again on Gulf Coast,” Washington Post,
October 27, 2005, p. A10.
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Arguments Generally Supportive of Davis-Bacon
Supporters of Davis-Bacon hold that the act prevents cutthroat competition from
“fly-by-night” firms that undercut local wages and working conditions and compete
“unfairly” with local contractors: that the act helps stabilize the local construction
industry, an advantage to workers and employers alike. The act, they suggest, may
tend to assure the consuming agency of higher quality work since employers who are
required to pay at least the locally prevailing wage are likely to hire more competent
and productive workers — resulting in better workmanship, less waste, reduced need
for supervision, and fewer mistakes requiring corrective action. This may lead to
fewer cost overruns and more timely completion of public construction and, in the
long-term, lower rehabilitation and repair needs down the line. Thus, some argue,
the Davis-Bacon Act could actually save the taxpayer money on public construction.
Supporters of the act also argue that Davis-Bacon deters contractors from
fragmenting construction tasks to utilize low-wage (and often low-skill) “helpers” or
pick-up crews. They believe this could result in a trade-off of long-term social
benefits for short-term profits. Some argue that without Davis-Bacon (and in the
absence of a collective bargaining agreement), contractors would be unlikely to
provide training, whether formally through a certified program or through informal
investment in human capital (improving the skills of their regular employees).
Advocates also contend that repeal or weakening of the act may adversely affect
apprenticeship programs in the construction industry to the disadvantage of minority
and women workers who are entering the building trades in growing numbers. If
“helpers” are substituted for skilled craft workers, it would likely be minorities (and,
to a lesser extent, women) who would be laid off or forced into lower-wage jobs,
some assert.
How Good is the Information We Have Concerning
the Effects of the Davis-Bacon Act?
The Davis-Bacon Act, among labor laws, is widely known but it may not be well
known. The Davis-Bacon literature, if one takes into account agency reports and
congressional hearings, is extensive. These public documents have provided a basis
both for popular and scholarly consideration of the act.
Perhaps the most frequently asked question concerning the Davis-Bacon Act is:
Would we save money if the Davis-Bacon Act were repealed or modified to narrow
its scope? The short answer is: No one really knows. Conversely, might Davis-
Bacon result in savings to the federal government in its purchases of construction?
That, too, would seem to be an open question.
Another question frequently asked by those, both in industry and in the
workforce, who may have to deal with the Davis-Bacon Act is: Is this particular
project covered? And further: If so, why? If not, why not? To whom is assigned
the judgment for making such determinations? Such questions might be answered
were there a scholarly, institutional history of the act and of its place within the
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broader field of public contracting policy. If such a study exists, it does not appear
to be generally available.
The General Nature of Davis-Bacon Research
There have been numerous hearings through the years since the Davis-Bacon
legislation was first considered. They have tended to focus on policy issues or have
served as a forum for airing complaints. Less time has been devoted to examination
of economic impact or to its assessment.
The Davis-Bacon literature is extensive and diverse. Generally, it falls into
three categories: public materials (i.e., agency reports and analyses); journalistic
pieces; and academic studies. The latter are also diverse: work commissioned by
interest groups (which may be scholarly, nonetheless), articles that merge journalism
with scholarship, and putatively independent academic work.
Given the number of projects covered by the act, it is nearly impossible for an
independent scholar to review its administration and to assess its impact. First.
There is the scope of the task: thousands of projects throughout the United States,
administered by different agencies and involving hundreds of contractors. Second.
There is the problem of availability of basic documentation. How much information
has actually been preserved? Are the reports, required under the Copeland Act,
factual and complete? Access to data presents a third problem. Assuming that the
data are available, securing such documentation (and access to administrative
personnel) may be problematic.
If one assumes that documentation exists, that the independent analyst is granted
access to it, that all of the parties are cooperative, and that the means, financial and
other, are available for such an undertaking, the analyst is left with a fourth
complication. He is comparing something that did happen with something that in
fact, for whatever reasons, did not happen. In the absence of a Davis-Bacon
requirement, would the contract have gone to the same contractor? If so (or if not),
would it have been managed in the same way? Did the contracting agency monitor
the project carefully — and was such monitoring comparable with that for non Davis-
Bacon projects? Did the act have any impact upon the wages actually paid or upon
workforce utilization? Without Davis-Bacon, would different workers have been
employed?
These same questions confront a public agency in its efforts to investigate
Davis-Bacon impact: the availability of the data, the willingness of the various
parties to cooperate in an investigation, and the speculative character of the
comparison between what did happen, what did not happen, and what might or might
not have happened under different circumstances. For a public agency, the task is no
less massive than for a private scholar. And, in the public sector, there may be other
constraints. How much funding and staff time should be devoted to an investigation
of Davis-Bacon impact? What political or policy concerns may come into play?
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Significant Gaps
There appear to be significant gaps in our knowledge of the act and of its
administration despite oversight by Congress, extensive study by public and private
agencies, and the work of individual scholars. Further, few studies of the act,
whether public or private, have escaped criticism on the grounds of flawed
methodology or inadequate sample size.
Some Agency Studies. Federal agency reports provide primary
documentation concerning the Davis-Bacon Act. But often the various agencies have
disagreed about assessment methodologies — sometimes, as in the 1970s,
vigorously.
The General Accounting Office, as might be expected, has conducted extensive
oversight of the act. During 1962 to 1971 alone, GAO issued eight reports,
increasingly critical both of the statute and of its administration by the Department
of Labor. In 1979, as noted above, it published an extensive analysis titled simply,
Davis-Bacon Should Be Repealed. The 1979 GAO report was immediately
controversial — and frequently cited. Labor Secretary Ray Marshall severely³⁸
attacked the report, maintaining that it had “little credibility.” Subsequently, the
report and the issues it raised were a focus of review by three separate congressional³⁹
committees during which both its methodology and findings were questioned.
The Congressional Budget Office (CBO) is frequently cited with respect to
Davis-Bacon impact. In a 1983 report, Modifying the Davis-Bacon Act: Implications
for the Labor Market and the Federal Budget, CBO attempted to set a dollar figure
for any increased cost of federal construction sparked by Davis-Bacon requirements.
Cautiously, CBO noted “a number of problems in [the] available data and method”
and noted that “data on these effects are highly inconclusive.” CBO does not appear
to have conducted independent research for its 1983 report, relying upon the existing
literature which estimated a range of impact “from $75 million to $1 billion a year.”^40
38 Press Briefing by Secretary of Labor F. Ray Marshall, July 17, 1979, p. 44. (A
mimeographed press release.)
³⁹ See U.S. Congress, House Committee on Education and Labor, Subcommittee on Labor
Standards, Oversight Hearings on the Davis-Bacon Act, hearings, 96^th Cong., 1^st sess.
(Washington, U.S. Govt. Print. Off., 1979); U.S. Congress, Senate Committee on Banking,
Housing, and Urban Affairs, Subcommittee on Housing and Urban Affairs, Davis-Bacon^thst
Legislation, hearing, 96 Cong., 1 sess., May 2, 1979 (Washington, U.S. Govt. Print. Off.,

1979); and, U.S. Congress, Senate Committee on Labor and Human Relations, Military^thst

A decade later, in his May 4, 1993, testimony before the House Subcommittee
on Labor Standards, CBO Director Robert D. Reischauer noted: “Let me at this point
mention a caveat about CBO’s estimates, and this is that they are based on relatively
old information. They are derived from a 1983 report that CBO issued that weighed
the evidence from all of the studies that were available at that time. Unfortunately,”
he added, “little has been written about the impact of the Davis-Bacon Act since

1983, and so we have had no reason to adjust our estimates.”⁴¹

35!37, 49!51.

federal judiciary establishment, and perhaps more to run than the entire legislative
branch of government.”⁴⁴ The basis for this assertion, however, is unclear.
Since 1980, Steven Allen has produced a number of studies that deal, directly
or indirectly, with Davis-Bacon. In an essay with David Reich, Prevailing Wage
Laws Are Not Inflationary, they argue that “there is strong evidence to suggest that
there are significant productivity differences between low-wage and high-wage
workers.” Allen and Reich state: “Paying at least the locally prevailing wage rate
will make it possible to attract better trained and more highly skilled construction
workers able to complete the job quickly and efficiently.” Focusing upon state
experience, they conclude that “once all the relevant variables are taken into
consideration, there is no evidence whatsoever of any correlation between the level
of construction costs and the presence or absence of a state ‘little Davis-Bacon
Act.’”⁴⁵ The essay was prepared for the Center to Protect Workers’ Rights, chaired
by Robert Georgine, President of the Building and Construction Trades Department,
AFL-CIO. Allen has developed this theme in subsequent academic work and is often
cited.
A 1982 study, Effect of the Davis-Bacon Act on Construction Costs in Non-
Metropolitan Areas of the United States, was prepared by Martha N. Fraundorf (with
others) of Oregon State University. Fraundorf suggests that the cost estimates for
Davis-Bacon offered by GAO, Thieblot, and certain others are based on “an
erroneous procedure” and she chides GAO for working from a sample even the
agency recognized was “really too small for extrapolation.”⁴⁶ But, the Oregon team,
funded by the American Farm Bureau Federation (a critic of Davis-Bacon), was
forced to scale back its own work because of difficulties it encountered in securing
adequate data.
Fraundorf and her colleagues began with an assumption: “While it is fairly clear
that the law results in higher wages, it does not follow that the law therefore raises
overall costs.” To determine the latter, they attempted an empirical study of total
costs. But, they found this to be complex. First, they looked only at rural non-
residential construction — which, they conceded, might differ from urban work.
Second, they could not disaggregate Davis-Bacon costs from other federal
requirements (i.e., “affirmative action, or different standards for quality and safety.”)
Third, they were not able to access varying “alternative method[s] of construction.”
Within those parameters, they compared federal with non-federal construction,
⁴⁴ Thieblot, The Davis-Bacon Act, p. 170.
⁴⁵ Steven G. Allen, and David Reich, Prevailing Wage Laws Are Not Inflationary: A Case
Study of Public School Construction Costs, Washington, Center to Protect Workers’ Rights,
December 1980, p. iii.
⁴⁶ Martha Norby Fraundorf, with John P. Farrell, and Robert Mason, Effect of the Davis-
Bacon Act on Construction Costs in Non-Metropolitan Areas of the United States.
Corvallis, The Oregon State University, 1982, pp. 4!5. (Hereafter cited as Fraundorf, et al.,
Effect of the Davis-Bacon Act on Construction Costs.)
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concluding: “While the exact size of the impact is still uncertain, our results show
that it is likely to be between 26% and 38%.”⁴⁷
Frequently cited in the Davis-Bacon literature is the work of economists Robert
Goldfarb and John Morrall. Begun as public research for the U.S. Council on Wage
and Price Stability (COWPS) during the mid-1970s, the work of Goldfarb and
Morrall was further developed in a series of private academic articles. At COWPS,
they found themselves working with data provided by DOL which they viewed as not
entirely satisfactory for their purposes. In their COWPS analysis (1976), they
identified the deficiencies they found in the data they were using and spoke of “some
rough order of magnitude” of “possible cost savings” from changes in the
administration of Davis-Bacon. But, they cautioned by way of conclusion: “... the
data are somewhat ambiguous and perhaps unreliable.”⁴⁸
In a private academic article (1978), Goldfarb and Morrall seem to have been
somewhat less cautious suggesting that, with administrative changes with respect to
Davis-Bacon, “an overall savings in the hundreds of millions is possible.” And, they
point out, various administrative changes “might well encourage an expansion of the
nonunion sector, which might in turn have cost-lowering effects in the long run.”⁴⁹
Their work sparked some criticism which, in yet another article (1981), they
attempted to refute. Critiques, in the abstract, are difficult to evaluate and, even more
so, critiques of critiques; and, by the early 1980s, the literature was beset by argument
and counter argument, often focusing (as Goldfarb and Morrall had done themselves
in 1976) upon the inadequacies of the data. Seeming to share the approach of
Thieblot (and, like Thieblot, basing their work on pre-Reagan data), Goldfarb and
Morrall acknowledge the data problems but reject the notion “that this invalidates the
usefulness of cost calculations.” They affirm, rather, that even “rough estimates of
possible magnitudes of effects based on imperfect data are very useful background
information for helping inform policy decisions.”⁵⁰
During the early 1980s, a private sector body working under the auspices of the
Reagan Administration reviewed the operation of the federal government and
recommended ways in which to effect efficiency and reduce costs. The Grace
Commission, as it was popularly known, examined the operation of the Davis-Bacon
Act (among other statutes and programs). Its review of Davis-Bacon, frequently
cited at the time, was based on prior studies rather than original research. Thus, it
⁴⁷ Fraundorf, et al., Effect of the Davis-Bacon Act on Construction Costs, p. 27. The authors
note: “Furthermore, if the Davis-Bacon Act were repealed, it would not mean a 26.1%
decrease in costs unless state prevailing wage laws (which would still apply to many, but
not all, projects) also were repealed.”
⁴⁸ Robert S. Goldfarb, and John F. Morrall, An Analysis of Certain Aspects of the
Administration of the Davis-Bacon Act, Washington, Council on Wage and Price Stability,
May 1976, pp. 3 and 14.
⁴⁹ Robert S. Goldfarb, and John F. Morrall “Cost Implications of Changing Davis-Bacon
Administration,” Policy Analysis, fall 1978, pp. 449!451.
⁵⁰ Robert S. Goldfarb, and John F. Morrall, “The Davis-Bacon Act: an Appraisal of Recent
Studies,” Industrial and Labor Relations Review, January 1981, p. 200.
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was subject to all of the strengths and weaknesses of the earlier research upon which
it relied.⁵¹
In 1985, Chairman J. Peter Grace reviewed the work of the commission in
testimony before the Senate Committee on Governmental Affairs. Evidencing some
exasperation with quibbles over impact estimates in general, he urged that
policymakers should set aside the dispute about “how accurate the numbers are” and
get on with the business of reform. “No one can ever tell what something will save
until one does it,” he affirmed.⁵² While many may share Grace’s frustration, others
may argue that numbers do matter and that reasonable precision is important —
especially when cost-savings projections become a central rationale in public policy
formation.
During recent years, Peter Philips, professor of economics at the University of
Utah, with others, has produced a number of analyses of the impact of state “little
Davis-Bacon” acts — or, of the implications of the repeal of such statutes. Speaking
generally, these studies appear to have found a certain utility in prevailing wage
legislation: i.e., that prevailing wage statutes may (and, likely do) have positive
economic impacts for the community apart from any advantage to workers. Further,
these studies seem to suggest that allegations of negative impact (for example,
unjustifiably inflating the cost of public construction — or increasing such costs at
all) may be overstated.^53
51 Concerning the Grace Commission and its work, see DLR, November 10, 1983, pp.
A2!A5; Robert M. Cohen, “Reagan’s Cost Control ‘Bloodhounds’ Are Hounded by
Charges of Conflicts,” National Journal, January 15, 1983, pp. 122!124; Robert M. Hayes,
“The President’s Private Sector Survey on Cost Control: An Opinion Essay on the Grace
Commission Report,” Government Information Quarterly, vol. 3, no. 1, 1986, pp. 73!81;
and, J. Peter Grace, “The President’s Private Sector Survey on Cost Control: A Response
to an Opinion Essay on Its Proposals,” Government Information Quarterly, vol. 3, no. 2,

1986, pp. 153!161.

Bibliography
Through the years, the Davis-Bacon Act has attracted considerable attention
from economists, attorneys, policy analysts, journalists and others. The result is a
moderately extensive bibliography of materials readily available to the public. Its
quality, as noted above, varies from one item to another.
Most of the entries in this bibliography deal specifically with Davis-Bacon.
There are, however, a number that focus upon issues related tangentially (but
importantly) to questions that have been raised about the application of the act. For
example, an extensive literature has been developed dealing with the impact of trade
unions upon productivity, a central factor in estimating the cost impact of the act. A
representative sample of these studies has been included in the listing. Also included
are a number of entries bearing upon the nature of the construction industry and upon
legal issues associated with administration of the Davis-Bacon Act and with its
impact.
This bibliography is selective. While primarily of published materials, it also
includes, in a few instances, materials that have not been published but which have
been widely circulated through the years and/or which have had an impact upon the
Davis-Bacon debate. Because its focus is primarily upon analytical or policy
literature, a listing of congressional hearings and reports has not been included,
though these have been cited in the footnotes of the covering essay as appropriate.
Also omitted (with select exceptions) are studies produced by the Department of
Labor and the several legislative branch agencies such as the General Accounting
Office and the Congressional Budget Office.
There has been, through the years, a significant reportage concerning the Davis-
Bacon Act in the industry and trade union press: sometimes brief editorial comment;
on other occasions, publication of testimony presented before a committee of the
Congress or an analysis of legislation. For the most part, these industry and trade
union materials have not been included, though this latter policy has not been
followed uniformly. Finally, there are a number of manuals — how to administer the
act, how to conduct wage surveys, how to comply with the provisions of the statute
— that have been prepared by an agency or one of the interest groups. These, too,
have been omitted from the listing here.
For the most part, items listed in the bibliography are available from the general
collection of the Library of Congress and, frequently, are also available from
university collections and public libraries.
⁵³ (...continued)
Institute, Washington, D.C., October 2005. 14 p.
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1!4.

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——. “It’s Time to Reform New York’s Prevailing Wage Law.” Empire Foundation
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2001, 191 pp.

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