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How Managing Employees Correctly can Cut Costs on the Construction Site

The first thought most companies have when it comes to shaving costs is to attack the highest and most obvious source of recurring payments; total workers on the force. However, while this can be effective in circumstances which desperately call for downsizing, it can also counterproductive and even outright dangerous to entertain seriously.

Most important is the relationship between safety, speed, and cost. It bears repeating that no tactic or saving is worth entertaining if it endangers workers – even by a small amount – or compromises the safety protocols of the final product.

Hire for competence, rent for expertise

Hiring competent tradesmen, operators and construction workers with a diverse skill set will ensure your business is constantly manned with able-bodied workers who can excel at a range of disciplines. This has the added benefit of decreasing downtime between jobs due to the fluidity of skill sets.

Productivity comes from four areas: expertise, optimacy of operation, downtime reduction, and worker motivation. Hiring competent and diverse workers nips two of these in the bud (reducing their total downtime by making sure they can do multiple jobs, and making sure they’re expedient, which should be a byproduct of their training). Furthermore, trained personnel tend to be motivated personnel, due to the rigors inherent in progressing in their chosen field as well as diversifying. The only remaining task is for management to create an environment where their tools and resources are laid out in such a way for them to conduct operations efficiently.

There’s one important addendum to this: unless you’re a large enough construction company to be hiring a full staff of specialists for all possible occasions, you should consider the cost effectiveness of hiring contractors for any and all positions that might be cheaper per site than to have on staff.

Retention and motivation get results

Finally, don’t forget that motivation and satisfaction translates to results: motivated workers work 3.5 more days a year on average than unmotivated ones, retain 44% more information, produce 50% more, and have 50% less workplace accidents.

If you’re looking for ways to cut costs, efficient output is easily one of the most effective ways to begin. A motivated workforce can come from many directions; some people are motivated by sheer pay-grade – and if they’re motivated, producing better, and therefore earning more money, this should pay for itself in no time.

Others are motivated by the feeling of a team environment and a safe workplace, in which case making sure that there’s a strong bond between teammates is key. They sometimes seem hokey, but team building exercises or simply giving employees a shared area to eat or relax in can do wonders for team cohesion.

The main facets of employee engagement, according to Dr. Scott Kimball of Loma Linda University, are that they:

  • Use their talents every day;
  • Consistently demonstrate high performance;
  • Are naturally innovative and strive for efficiency;
  • Intentionally build supportive relationships;
  • Are clear about desired outcomes;
  • Have emotional commitment to what they do;
  • Display high energy and enthusiasm;
  • Never run out of things to do and create positive things to act upon;
  • Broaden what they do and build on it; and
  • Commit to their work group, company and role in the organisation.

In order to maintain engaged workers, you and your management must strive to foster a workplace where this can be achieved. As mentioned earlier, different workers respond to different stimuli, and no jobsite is the same, but when it comes to labour costs there’s no better measure for effective output (and therefore reduced cost per man hour) than keeping people happy


Accidents in the workplace do happen, and while a trained and ready workforce with all adequate security and safety measures can do a huge amount to both dampen the frequency and effects, it’s a simple fact that gravity, machinery, heavy objects, and humans working in a single environment will eventually create a dangerous situation.

Due to the extremely hazardous materials and machinery ever-present within most job sites, the safety codes must be up to an impeccable level to accommodate any work done within grounds. Alongside this, each Australian state and territory has their own workers’ compensation legislation outlining the rights and responsibilities for both employer and employee in the event of an accident.

In the event of a serious claim, defined under legislation as “an accepted workers’ compensation claim for an incapacity that results in a total absence from work of one working week or more”, the employer is generally expected to remunerate at least in part for medical, rehabilitation, and lost wages as a result of the accident for the worker. In essence, it works as insurance for your workers that they’ll be able to continue working in a potentially hazardous scenario without fear that an accident will cost them their livelihood.

A failure to budget, prepare, and attempt in earnest to prevent a situation where a claim will occur can be a major, unexpected hiccup in the budgeting of any company looking to save costs. It’s a lot easier to lose 1% productivity from an employee than it is to risk their health and safety; even in the event of a minor injury, you’ll still need to find a replacement and cover any wages, and 7+ days of paid leave is worth a lot more than than 1%.

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