Builders, Contractors Upset Over GOP’s Employer Tax Hike

The construction industry is angry about a GOP-approved plan to increase employer taxes to support the state’s unemployment insurance fund.

The plan the legislature’s budget committee approved – on a party line vote – would raise employer taxes by $32 million per year to shore up the unemployment fund. The fund is still running a deficit from the huge spike in jobless claims brought on by the Great Recession. Employers who frequently lay workers off and use the fund more often would get hit with the biggest share of the tax. In practice, that means members of the construction industry, many of whom are represented by the Operating Engineers of Wisconsin. Terry McGowan is the union’s president.

“It’s obviously picking losers. We live in Wisconsin, and the construction season in Wisconsin is a window period. And unfortunately, if we want to get things built in the state of Wisconsin, we have to work around the weather conditions, and unfortunately, unemployment is part of that structure.”

Others are also upset. Jim Boullion is the lobbyist for the Associated General Contractors of Wisconsin. He says this comes at a bad time for the industry.

“The amount of work that we’re able to find in the private sector is still very low, so to take a hit like this where you’re increasing the cost for unemployment insurance without even having a chance to have a hearing or discussion on it, it just is very concerning.”

Normally decisions like these are approved by the decades-old Unemployment Insurance Advisory Council, made up equally of representatives from labor and management. Republicans Wednesday circumvented that system, passing this and many other unemployment law changes where members of the council never found consensus.