How to motivate construction labor
by Steven G. Revay, Montreal
President, Revay and Associates Limited
Construction Management Consultants
Abstract: The author distinguishes between overall construction productivity and on-site labor efficiency and describes the five main management practices, including the provision of financial incentives, which can motivate construction field personnel toward achieving higher levels of efficiency.
Traditionally, productivity has been defined as the ratio of real output (in creating economic value) to the input of an associated resource, which is usually but not necessarily expressed in manhours.
Translating this definition for the use of the construction industry, it can be said that labor productivity is the physical progress achieved per manhour. Needless to say, in this context labor productivity may not be equated with labor efficiency, although it may be said that labor productivity indicates the efficiency with which labor time is being used in the production of real value.
According to most economic studies published either in the U.S.A. or Canada, the labor productivity in the construction industry has shown a steady growth over the years, even though the rate has been lagging behind other industries. But this is where the agreement ends. No two economists will agree on the actual rate of improvement, mostly because they could not agree on a uniform base for their measurements.
The reported annual growth rate varied between one percent (1%) to three point two percent (3.2%) averaging about two point six percent (2.6%).
In other words, these economic studies indicated that over the years there had been a steady decrease in labor input required to accomplish comparable results. For example, Behman reported (in 1972) that in 1930, 837.4 manhours were required to construct 1000 sq. ft. of living area in a single-family dwelling, which requirement, by 1965, was reduced to 283.2 manhours, which reduction equals an average of 3.2% annual growth rate.
Three point 2 percent (3.2%) represents an impressive rate of growth under any circumstances. It is no wonder, therefore, that some economists have tried to explain it as being the result of steadily improving labor efficiency, especially in circumstances when called upon to support unusually high wage hikes.
To do so, economists have equated relative growth in labor productivity with real improvement in labor efficiency, and by doing so have virtually put the construction industry to sleep. After all, why should anyone be concerned about a non-existing problem? Apparently lack of motivation was not a problem and the more and more frequently occurring losses on jobs were either related to poor estimating or later on, equated with a newly discovered buzz-word, i.e., impact of accelerated performance.
Construction Managers had soon run out of excuses, however, and were forced to realize that labor productivity was dropping even on jobs where there was no acceleration, and have therefore started to relate productivity with motivation, or the lack of it.
In fact, by then even economists had admitted that the reduction in labor requirements in situations such as those examined by Behman, resulted from a trade-off of manhours against non-labor resources, e.g., more efficient construction equipment, new type of material or improved design, and not from improvement in labor efficiency. Perhaps an even more vivid demonstration of the fallacy of equating labor productivity (as defined by economists) with labor efficiency, can be found in the following excerpt from a recent issue of a magazine published by the British Broadcasting Corporation (The Listener, July 10, 1980).
“In recent years, no big plant has been put up on time. No big plant now being built is on schedule. The delay ranges from two to two and a half years for a chemical plant to four years for something as big as Grain. The rot is not solely or even mainly due to strikes; it is the result of almost unbelievably low levels of productivity. Do you believe that a man can spend eight hours on a site but do only 45 minutes’ work in the whole day?
“No? But he can, and this is how he does it. In a standard eight-hour shift, clocking on, walking to and from the job, tea-breaks, bad weather, union business, leave less than four hours available for actual work. Inefficiency, overmanning and other bad habits will eat into another two or more hours, and you are left on a good British site with, at best, one hour and 40 minutes of actual working-time. On a bad site, where ten-minute tea-breaks have been known to stretch to an hour, the figure comes down to 45 minutes. Shop stewards can tell tales of awkward jobs that take hours to set up or high chimneys that take half an hour to climb up and thus explain away the little time a man spends with tools actually in his hands. There is, however, only one such chimney at the Grain.
“These are all actual, audited figures and they reflect deterioration; productivity at the Grain is about 30 percent worse than it was at two earlier and comparable power stations built at Fawley and Pembroke.”
Forty-five minutes of productive work in an eight hour day equates to 9.4 percent efficiency. Needless to say, it is rather difficult to maintain a 2.6 percent annual growth rate for the past thirty or so years when the net result of such continuous improvement is 9.4 percent productivity in 1980.
The technique used to measure “productivity” at the Isle of Grain site is known as work sampling which measures through random observations the ratio of productive time to total available time. For the purposes of such studies, productive time is defined as the time spent on cutting material, hoisting equipment, installing components or erecting formwork; in general, working with tools in hand.
Results of other work sampling studies vary from the low of 9.4 percent at Isle of Grain to a high of 64.4 percent measured by the National Association of Home Builders Research Foundation in 1973.
Other representative samples reported: 32 percent by the Civil Engineering magazine in 1977 measured at various nuclear power sites, 34.5 percent by S. B. Palmeter, measured at 13 nuclear power sites, 46.5 percent measured by the University of Texas at random sites.
The 9.4 percent result is, obviously, an exceptionally low result, and is probably caused by socioeconomic problems but even the 32 percent result is nothing to be proud of.
Although results of work sampling studies cannot be used to measure real labor efficiency, nevertheless they are extremely useful in helping the industry to gain a better insight into the question of motivation and at the same time highlighting the reasons behind drastic variations in productivity rates.
As it can be seen, the worst results have been measured at nuclear power sites, i.e., at large and complex projects where design changes are the rule and not the exception.
Against this at the other end of the scale are the residential developments, which are highly repetitive; therefore there is ample opportunity to correct any planning deficiencies, i.e., in the end result it can be said that the project, as a whole, is usually well planned.
Industrial projects and/or nuclear power stations are usually once in a lifetime accomplishments where any planning error, e.g., starting construction prior to being ready for it, will usually affect the project until final completion.
On residential developments most workmen are old hands, having worked on the same team for several units, i.e., they need little or no “instructions” as there are no late design changes. Accordingly, it may not be wrong to say that, as a fact, good communication exists between the planners and the doers.
On industrial or power projects seldom will the site supervision know all of the eventually imposed requirements at the beginning of the project. Accordingly, the planning effort required during construction will often deteriorate to crisis management, but more importantly supervision will be called upon to spend an inordinate amount of time on learning the project and/or the added requirements and communicating such newly obtained knowledge by way of instructions to the crew.
All of this time is, of course, unproductive. On residential projects each and every man knows what is expected of him and at the same time can readily measure his achievements.
It would not be wrong to state that on a residential project every employee should be able to identify himself with his task, which, of course, is seldom possible on a complex industrial project and probably never at a nuclear power site.
It is not a coincidence, therefore, that more time is spent productively by labor on a residential project than it is at a large and complex project.
In other words, it is not a coincidence that labor appears to be better motivated on projects where the tasks are well defined and achievement can readily be measured than on sites where everything seems to happen by accident and nothing appears to be carried out according to the original plans.
It is contended that through a detailed analysis of the differences in the modus operandi usually found at a residential development versus those at nuclear power sites, one can learn ways and means to motivate construction labor.
To understand the importance of motivation one must analyze all factors which influence efficiency.
Labor efficiency, in this context, is defined as the measure of the rate with which labor is doing what he is required to do at the given time and at a specific place, and to the extent that the expression of labor efficiency and labor productivity may be used interchangeably, labor productivity shall mean the rate of physical progress of a single task per manhour, where the added value has resulted from the input of human efforts only, and nothing else.
In simplistic terms, labor efficiency is governed by:
- Labor’s attitude vis-a-vis his assigned task, and
- His skill (or ability) to perform.
Unfortunately this definition tends to put the entire responsibility for efficiency, or the lack of it, onto the shoulders of labor (organized or otherwise) which notion is obviously wrong, because management has as much or more control over efficiency as has labor. A better definition of the factors which control labor efficiency would therefore be:
- Extraneous constraints, e.g., governmental regulations, climatic conditions, union rules, etc.
- Skill and inherent attitude of labor, and
- Management practices.
Within this definition, motivation plays a role in two of the above factors, namely:
- Motivation (or attitude) which is possessed by the individual when arriving on the site. This attitude may be the result of the individual’s social background, his family relations, religious or even political affiliations.
- Motivation resulting from the various job related factors, i.e., management controlled factors.
Based on the experience gained from the above cited work sampling studies, management practices which usually affect motivation are as follows:
- Communication between planners and doers,
- Work environment, e.g., cleanliness, safety, adequate sanitary facilities, protection from the inclement weather.
Nothing needs to be said about the importance of good work environment with respect to labor efficiency, nevertheless, construction supervisors at times fail to realize that construction workers like to be treated like human beings, the same as everyone else does.
The influence of planning and communication is understood even less at times.
Planning, in this respect, includes both overall job organization as well as work distribution at site level. Higher level planning must provide for efficient sequencing of the various phases, e.g., design must precede the preparation of construction drawings and on-site construction should not start until adequate drawings are available. Similarly, subsequent trades should not be called onto the site until the preceding trade has progressed sufficiently to allow uninterrupted flow of work.
Site management must assure that required material in sufficient quantity is available for continuous progress.
Good planning demands that design problems are to be resolved on the drafting table and not by tearing out already completed work.
Planning, from the point of view of motivation, is considered good when work crews can build up and maintain momentum in the carrying out of their assigned task without interruption until completion.
Communication is considered good on a job when each and every individual who is expected to have an input in the ultimate success is kept constantly advised of what is being expected of him in a clear and unambiguous manner.
Such a flow of communication must start at the level of initial indoctrination, namely the purpose of his being there must be communicated to every member of the construction team. Similarly, he should know ahead of starting time all about the tasks he is about to undertake.
The detail of instruction will obviously depend on the level of the given individual’s responsibility and the length of the advance notice must be commensurate with the expected duration of his reaction time.
A tradesman should have at least a day’s advance notice so that he can prepare himself for the coming task.
The quality of construction drawings is a typical example of good versus bad communication.
Incomplete or poorly prepared drawings will seldom give sufficient description of the job requirements, thus proper planning is not possible, if for no other reason than because good planning demands a complete understanding of the entire project.
Poor drawings create confusion, give rise to questions and in general, prevent good understanding between the planners and the doers.
Incomplete drawings beg revisions and frequently give rise to changes which, in turn, are negative influences on motivation.
Communication does not stop with the drawings and/or technical instruction, however, but it encompasses two seldom discussed components, namely:
A – Definition and the maintenance of the required discipline, which includes the enforcement of the desired level of workmanship, and
B – Just reward.
Many theories have been advanced in the past with reregard to motivation of human beings, such as Maslow’s hierarchy of needs, Herzberg’s two factors — the equity theory and the expectancy theory. It is contended that in the final analysis all of those theories may be reduced to three questions, namely:
- What energizes human behavior?
- What directs such behavior?, and
- How is this behavior sustained?
Although little or no agreement may be visible among the various behavioral scientists in answering these questions, nevertheless, if their findings are brought to a common denominator, they seem to be saying that:
- Human beings are energized by their physiological needs,
- Their behavior is directed by their expectancy, and
- Their behavior is sustained by obtaining just reward.
It is contended that the saying – “nothing is as successful as is success” is still very true, but most students of human motivation now feel that it is not just the satisfaction gained by being successful but the rewards earned through success cause sustained progress.
Speaking of reward, one automatically thinks of monetary compensation, but experience shows that this need not be so. Rewards can be advancement in the chain of command or social recognition or reward may take the form of a pat on the shoulder, or, it may even be the satisfaction of a job well done, depending on the circumstances and the character of the individual in question. It must be realized that not everyone is motivated by monetary rewards.
Rewards appear to be a powerful motivator on construction jobs also, but the worker should always be aware of both the reason for and the nature of the reward. Moreover, the size of the reward should be commensurate with the reason. Unearned or unduly large rewards can have the opposite effect. Finally, rewards alone, without the other motivating factors being satisfied are of little value.
The proof of this principle may be observed at the Isle of Grain site, where employees are frequently granted large raises called productivity bonuses, but which could be better described as a form of bribe.
The basic wage at the Isle of Grain became a show-up payment earned at the minute the worker entered the site. The bonus, on the other hand, became the compensation owed to the worker for getting some work done. This bonus, at Grain, could be three times greater than the basic wage.
Similar but less scandalous examples may be found at some North American power sites where workers demand and receive guaranteed overtime as compensation for agreeing to hire-on.
Needless to say, both the productivity bonus of Grain and the guaranteed overtime premium at other sites are of little use, if not outright detrimental, with regard to enhancements of motivation.
In summary, it may be justifiable to repeat, as stated above, that reward alone will not offer lasting help in motivating construction labor, and satisfactory efficiency can be maintained on jobs only where there is:
- Good planning,
- Efficient communication,
- Favorable environment,
- Fair but firm discipline, and
- Provision to apportion and distribute just rewards.
If it is difficult to find jobs today where the first four prerequisites are satisfied, then it is virtually impossible to find a site where there is an effective financial incentive scheme in operation.
In fact, both contractors and organized labor tend to frown upon financial incentive programs, or so it is commonly believed.
A recent study carried out by Laufer and Borcherding of the University of Texas seems to indicate that much of the apparent reluctance is against the usually suggested form of incentive schemes and less against the principle.
The above study, which has been carried out pursuant to the Delphi technique, included representatives of contractors, buyers of construction services, professors, consultants and union officials, totalling 30 panel members chosen both in the U.S.A. and Canada.
The conclusion reached by this study has been summarized as follows:
“The findings presented in the previous chapters clearly indicate that financial incentive programs for the construction labor force are not only feasible but that they could materially raise productivity, lower production costs, shorten construction time and increase the earnings of the workers. The majority of the panel predicted that the advantages obtained from operating financial incentive programs will be greater in extent than might at first be apparent. The effect on worker productivity, usually assumed to be the main justification for operating an incentive program, will be supplemented by certain other benefits such as improvement in the planning, organization and control of work. Programs aimed at specific productivity areas should be effective in reducing frequency of accidents, rate of turnover and overtime, and in improving the quality of the product.”
This conclusion surely provides a compelling “motivation” to all concerned with increasing efficiency and productivity to take a new look at financial incentives, especially on large-scale construction projects. Whether or not the study’s recommendation is the ultimate necessary to the enhancement of motivation may be questioned, but the idea is of sufficient importance to deserve an in-depth investigation. Construction has come a very long way from being comprised mainly of small and medium-sized projects, characterized by relatively simple and repetitive tasks. The present and future emphasis on “Giga” energy-related projects means that huge complex jobs will constitute an increasingly important factor in the overall construction program. Accordingly, it will be all the more vital that motivational matters be thoroughly addressed.
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