State and Local Economy

Project Labor Agreements focus on creating and supporting careers for local workers, and thus reinvesting in the local communities.  Many of these public projects are located in urban centers that have been hit disproportionately by the current economic crisis and are suffering from extremely high unemployment.  Public agencies therefore are implementing increasing number of PLAs to ensure that local tax dollars have the greatest impact on the local economy. 

Project Labor Agreements ensure that every employee has access to a fair wage, health care, and pension benefits so that he or she can support a family.  And PLAs often seek to guarantee that this opportunity is extended to Americans from impoverished communities.  The value of this opportunity for to the workers, their families, and the community cannot be understated, as the influx of family-supporting wages alleviates the burden on public assistance programs, increases the tax base, and creates a boon to the local economy.

For example, the lack of health care coverage in the construction industry has created an enormous financial burden on the public. Roughly 42 percent of workers in this highly cyclical industry do not have employer-sponsored health care, and this cost has been transferred to the public.  A UC Berkeley study estimates that in 2002 in California alone, 200,000 uninsured and underpaid construction workers cost the state almost seven hundred million dollars in Food Stamps, public health insurance, and other programs.

As more members of the community gain access to a family-supporting income, the local economy benefits.  Increased wages have a secondary multiplier effect on the economy.  Workers use their pay to buy goods and services, which supports other local industries.  This process is repeated, providing a general economic stimulus to the local economy.

Additionally, the use of Project Labor Agreements in large-scale projects can help protect the environment by helping to ensure that environmentally-sensitive projects are conducted by skilled workers. The Sierra Club, the nation’s largest environmental organization, has advocated the use of PLAs on federal projects.  In response to a 2001 court ruling upholding the use of PLAs on federal projects, they wrote:

"We support PLAs not only because they build better, cheaper, faster; they also support the environment. This ruling is not only good public policy in general, but also good environmental policy. PLAs hold down the costs of environmental clean ups as well as ensuring that this work will be done with the highest possible quality standards. PLAs also act as a stimulus to fight urban blight through urban redevelopment, helping the community and training the workforce for long-term recovery. We look forward to working with unions as partners in this process."