The Associated Builders and Contractors (ABC) has released its annual Merit Shop Scorecard, measuring which states are best for which the construction industry can thrive.
Key takeaways include:
The 2024 Building America: The Merit Shop Scorecard rates state laws, programs, policies and statistics in seven categories: project labor agreements, prevailing wage laws, right-to-work laws, public-private partnerships, workforce development, CTE and job growth rate.
Low-performing states maintain policies unfriendly to open shop contractors and taxpayers, such as encouraging or requiring the use of government-mandated PLAs on state and/or local projects, including new executive actions by governors in Hawaii, Maryland and Pennsylvania. Policies limiting opportunity for the merit shop workforce, which makes up the majority of construction workers in these states, also lead to lower-than-desired outcomes in workforce readiness and job growth for the construction industry, whether union or merit shop.
The top states are:
1. Wisconsin
2. Arkansas
3. Kentucky
4. West Virginia
5. Florida
1. Wisconsin has been a high-performing state year after year, but takes the top spot for the highest scores on fair and open competition policies prohibiting government-mandated project labor agreements, ensuring market-driven wages on public works jobs and protecting workers with its right-to-work law; a sustained level of positive job growth in construction, with a five-year job growth rate of 4.4%; a continued commitment to quality career and technical education, delivering a 97.4% graduation rate for students in career technical education programs and a 91.4% rate of postsecondary CTE students placed in careers and/or apprenticeship programs; and a workforce development pipeline that delivers a construction labor supply over 100% of demand amidst a severe nationwide construction labor shortage.
2. Arkansas came in second behind Wisconsin, one step up from 2023 when it ranked third. The state has excelled at all aspects of fostering and educating a skilled workforce, boasting a 6.1% growth rate in construction industry jobs and delivering outstanding results in CTE. Arkansas also maintains a fair and open public construction market, allowing the full breadth of the state’s construction workforce to pursue projects.
Florida, Arizona and Indiana remain high-performing states. All three maintain exceptional CTE and workforce development programs, delivering a robust and highly skilled workforce. Indiana continues to protect public projects from the threat of PLAs on the state and local level when possible, including targeted policies such as the prohibition of government-mandated PLAs on large-scale projects in Indianapolis. This highlights Indiana’s successful defense of the merit shop and taxpayers in a historically difficult Midwestern political environment.
According to ABC, Florida, a former first-place state, continues to perform highly across the board. With one of the largest economies in the country and extensive labor needs, it has maintained a particular focus on innovative career-centered education opportunities. This continues to yield positive results for craft professionals and the construction workforce as the state experiences record population growth.
Arizona returned to the top 10 in 2024 due to a 5.8% job growth rate in construction and a 90% labor supply versus demand, along with the state’s continued maintenance of a prohibition on government-mandated PLAs and other policy vehicles fostering an attractive business environment.
Michigan continued to drop in the rankings in 2024, falling to No. 33 due to the full repeal of right-to-work legislation.
The bottom five states, in ranking order, were Washington, the District of Columbia, Illinois, New York and Hawaii, each receiving poor ratings for creating conditions and policies that allow merit shop contractors to thrive.
“Policies and processes that protect free enterprise, promote economic growth, reduce regulatory burdens and expand workforce development create the conditions to welcome all of the U.S. construction industry to rebuild America’s infrastructure,” said Ben Brubeck, ABC’s vice president of regulatory, labor and state affairs. “States like Wisconsin, Arkansas, Kentucky, West Virginia and Florida set the standard in favorable conditions for the construction industry, and its workforce, to thrive. Hard-working taxpayers are best served by a regulatory environment that creates a level playing field for all contractors to build America with fewer obstacles.”
