is contractor cost wages
1 Public contractors may pay at prevailing wage rates without the regulation. 2  Average labor costs, including benefits and payroll taxes, are roughly one-quarter of construction costs. 3  Thus, even if a prevailing wage regulation raised wages by 10%, the impact on contract costs would be less than 2.5%.n a study of new school construction in British Columbia, researchers looked at six years of contract costs before and after the adoption of a prevailing wage law in 1992. Bilginsoy and Philips (2000) found that, without introducing any controls, prevailing wages correlated with 16% higher construction costs.