(The Center Square) – Publicly funded construction projects often hire workers from other states, who, rather than pay taxes for local schools and services, bring their earnings back home.
It’s a problem state Sen. Devlin Robinson, R-Westmoreland, says the commonwealth must address via legislation he introduced earlier this month to establish local hiring requirements.
He’s got broad support among the building trades and the administration itself, though the finer details leave some uncertain about the administrative costs to taxpayers. While hiring local workers makes sense, processing waivers from employers unable to meet the 50% threshold could stretch the Department of Labor and Industry’s resources thin.
Joe Hughes, director of government relations for the western Pennsylvania chapter of the International Union of Painters and Allied Trades, said during a Senate committee hearing in Carnegie the economic impact of doing nothing is “vast.”
“You can’t even calculate it,” he said. “All we got out of it as a region was some stay in a cheap hotel, some convenience store spending. We didn’t get any long-term investment. They didn’t pay any taxes for local schools.”
It doesn’t save money, either, he added. When the iconic yellow Andy Warhol Bridge in Pittsburgh underwent a $26 million refurbishment in 2017, out-of-state bridge painters received $5 million in payments for their portion of the project, which was the majority of the $7 million painting budget.
While all other local union trades on the project came in under budget, Hughes said the painting budget was blown by $668,000.
“I can tell you about Trade Institute of Pittsburgh graduates who live just blocks away from large, publicly funded construction projects,” said Donta Green from the Trade Institute of Pittsburgh. “They can see the cranes, they can hear the machinery, they know the work is happening in their communities – but they’re not on those job sites. Not because they aren’t qualified, not because they aren’t trained, but because there’s no requirement to hire local first.”
Robinson’s bill would require that state and local projects costing more than $500,000 hire at least half of their workers from the commonwealth. Contractors unable to do so can apply for a waiver, but must first exhaust the state’s recruitment offices and contribute to a training fund for future workers.
“Pennsylvania tax dollars should be used to support local workers,” he said. “This initiative seeks to strengthen our workforce, keep jobs local, and promote cost containment and efficiency on taxpayer-funded projects by reducing the need for out-of-state workers to travel to Pennsylvania and be temporarily housed near the project site.”
Contractors, however, worry that doing so could distance projects with other states entirely, ultimately harming the entire industry.
“We all don’t like when the Chicago companies and Texas companies come up” said Hank Butler, lobbyist for the Pennsylvania Council of General Contractors. “We agree 100%, we don’t want them coming in and kicking our contractors out or coming in and under-bidding everybody.”
However, he said, workers recruited from the state’s hiring program lack the caliber of skills necessary for many jobs, and paying into a training fund holds little value.
“I know it’s important to the unions and I respect them for that, but companies I represent, they don’t, their employees don’t pay a fund for training,” Butler said. “They are given training for free, much like a benefit.”
He suggested instead that worker pools are limited by time zone, not residency.
The department itself expressed doubts about the feasibility of its recruitment database to keep projects on time. The bill requires a three-day hiring window, which it described as too restrictive.
