Whether prevailing wage makes sense or not really comes down to how important it is for your crew to be trained. Because guys are paid what they are worth in the open market, and guys who are fully trained are usually paid more than the prevailing wage scale. At least that is true where I live. If it is OK to have just the foremen and some lead guys fully trained, and use unskilled labor for the rest, then you might consider deliberately building a building with a few good guys and a bunch of schmucks. If you did that, you might end up with as much as a 10-15% differential in the entire crew rate between prevailing and not prevailing wage projects. That includes the reality that if your guys are less skilled, their productivity is lower, and you need more working hours, more guys or both to build the job. Most federal money prevailing wage projects also require the use of more apprentices than we would normally use, because there is a desire on the government's part to ensure that we keep a pipeline of apprentices coming to take the place of guys who retire, as well as helping with both training and employment for young people. That increase in the % of folks who are apprentices partially offsets the requirement that people be paid at the rate that a trained person would expect to get. Not completely, because again they tend to be less productive, but partially. Finally, less work has to be done over again, fewer mistakes and fewer accidents when the crew is fully qualified. Can't say the same if a significant % of the crew is not fully trained.
Also recognize that the costs of equipment and materials are agnostic regarding whether a project is prevailing wage or not prevailing wage. Net net, the total impact of prevailing wage is probably at least 5% in the total project cost, but rarely 10%. It is something, but it is not a big factor in a building's construction budget.
And remember...skilled labor isn't cheap, and cheap labor isn't skilled. That has been true as long as construction has been in existence. It might be OK to have sloppier work on some buildings. That is a decision that ought to be made consciously, rather than blindly. Which is one of the reasons for prevailing wages. Are they a good idea? That is as much a political and social question as it is a cost question. But don't over-estimate the cost magnitude for a building's total delivered cost in terms of whether the project is prevailing wage or not, because I have yet to see a total building that would have more than a 10% differential due to prevailing wage, and it is typically less than that. Specific trades might be more or less, but the IPF is not $50 million solely or even significantly due to prevailing wage rules.