A prevailing wage is the basic hourly rate of wages and benefits paid to a number of similarly employed workers in a given geography. Policymakers can use prevailing compensation levels to set wage and benefit floors for workers in the locality—for example, construction workers on government-funded projects in Minneapolis or security guards providing government contracted services in New York City. Prevailing wage laws can ensure that government dollars do not undercut local wage and benefit standards, prevent a race to the bottom among publicly funded contractors, support good jobs, and provide good value to taxpayers.
The above excerpt was originally published in Center for American Progress.
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