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Thursday, January 9, 2014

Labour Cost Estimation

Labour cost estimation helps in understanding how much hiring and paying a labour influences the employer’s benefits costs, insurance premiums, payroll tax contributions and others. Estimating direct cost estimation includes various methods following which the entire procedure becomes much simpler. Following the below mentioned instructions would help in estimating labour charges accurately and preparing a precise budget for a project:
  • It is crucial to estimate the number of labour required to complete the project. The estimation should be created with regard to each phase of construction.
  • Apart from number of labour, labour hours required for the completion of each phase of the construction, should also be estimated. Labour hours should be multiplied by the number of workers required to complete each steps. This would help in attaining a detailed list of each step and the probable time needed for completion of each.
  • Calculation of the wages paid to the labour ought to be done as wages are a part of direct labour cost. Wages vary for each labour, like an experienced and skilled framer would receive higher wage than an inexperienced helper. Labour hour should be sorted as per wage level and should be assigned to each worker performing the work.
  • Before preparing a labour estimation, cost estimator should always consider unforeseen issues that may arise. This helps in handling unknown issues and saves expenses and prevents delay in completing the project. It is one of the most critical part of estimating, one cannot judge what kind of issues may arise and at what level of the construction. If certain material is unavailable, labours at work may not be able to work but nevertheless, they must be paid their wage.
  • Non- building labour hours that include, workers sent to get extra materials like, paint, nail etc. should be considered while estimating labour cost and hence a reasonable number of hours for non-building requirements must be added.

Published by Tuhin Maity
CAD Drafter & Designer

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