Agenda - Council Work Session - 07/28/2026

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Determining the full cost of uninsurance, let alone the cost for uninsured construction workers, is beyond our scope. But in addition to causing hardship for uninsured construction workers, uninsurance creates significant expenses for states, counties, and the federal government. The Kaiser Family Foundation reports that in the years 2015-2017, uncompensated health care costs for the uninsured nationwide averaged $42.4 billion per year, with the public picking up around 80% of these costs.32 Discussion Construction was once an industry that could reliably provide family -supporting jobs to its blue-collar workforce. Conditions in the industry have deteriorated so much that construction workers are now more likely than the average worker to utilize public safety net programs. Importantly, the numbers provided in this analysis do not fully reflect the deprivation among this workforce. Undocumented immigrants currently comprise 13% of the construction workforce (compared to 5% of the overall US workforce),33 and with rare exceptions they are ineligible for state and federal assistance.34 Their working conditions, among the worst in the industry, are not reflected in this analysis. The low wages and exploitative practices in the construction industry that cause profound hardship for many workers and their families also cost the public. When employers misclassify their workers or pay them under the table, they are defunding and defrauding government programs, including workers' compensation, Social Security, and Medicare. Ormiston et al. (2020) conservatively estimate that fraud in the construction industry yields Social Security and Medicare shortfalls of between $1.36 and $4.28 billion annually; federal income tax losses of $319 million to $1.26 billion; and state income tax revenue losses of $160 to $552 million.35 Overall, misclassification is estimated to cost state and federal coffers at least $3,000 annually for every worker that is misclassified.36 The lack of both employer -provided insurance and access to workers' compensation leaves many construction workers unprotected and uninsured. And, as found in this analysis, low -road employment practices cause above -average utilization of safety net programs by construction working families. The labor standards enforcement void created by declining unionization in the industry has not been filled. Without government intervention, construction workers should expect to continue to be exploited and cheated, and lawful contractors should expect to find it more and more difficult to remain in operation. Appendix: Methods We mainly rely on four sources of data: the US Census Bureau's American Community Survey (ACS), the March Supplement of the US Bureau of Labor Statistics Current Population Survey (CPS), the US Bureau of Labor Statistics Occupational Employment Statistics (OES), and administrative data from the Medicaid, CHIP, TANF, EITC, and SNAP programs. Medicaid figures exclude aged, blind, and disabled enrollees. The ACS surveys a large number of respondents and asks them about their work history, income, and family structure. The March Supplement of CPS, also known as the Annual Demographic Supplement, asks respondents about receipts of cash and noncash transfer payments during the past year and includes questions about the programs we examine in this analysis. The Public Cost of Low -Wage Jobs in the US Construction Industry