January 2, 2026
Let’s face it. Quite like the retail and manufacturing sectors, the construction industry essentially hinges on manual labor.
However, while the other two sectors have become innovative and reinvented themselves, the construction industry continues to struggle. As stated by the global construction productivity report, construction labor productivity has averaged only one percent annual improvement over the past two decades. In contrast for the same period, the global labor productivity improvement for manufacturing has been 3.6 percent annually.
Labor productivity has long been a challenge for the construction industry. FMI Corporation’s 2023 Labor Productivity Study confirms the trend of productivity decline in the construction industry, with only 23 percent of respondents claiming labor productivity improvement over the past 12 to 18 months. Almost half of the respondents saw declining labor productivity, and a third witnessed stable labor productivity trends in their businesses.
Labor productivity is the economic engine of labor-intensive, self-performing contractors. Labor is also the largest, riskiest, yet most controllable variable cost. Managed well, labor productivity can significantly improve bottom-line margins. Managed poorly, labor overruns or exceeding labor budgets can totally wipe out a contractor’s profitability.
Before we explore the factors affecting construction labor efficiency, plus some ideas on what can be done to improve it, let’s produce a clear-cut understanding of productivity in the construction sector.
Visualize a crew working in an assigned zone, intending to finish a precise amount of work within a set time period. In this scenario, productivity is the successful completion of the allocated tasks by the crew within the designated time, utilizing the proper number of workers.
Let’s now look at those factors shaping construction labor efficiency, followed by some ideas on what can be done to improve it.
Attitude and positive atmosphere
Stress and an uncomfortable atmosphere on the jobsite can create an environment that simply doesn’t contribute to productivity. Increasing conflicts among the workers, disputes, over-inspections, excessive hazards, multiple contract changes, poor site conditions, disruption of work rhythm and more can even lead to project failure.
Weather
Hostile weather is a major source of lost productivity on a construction project. The parties’ contract normally will deal with where the contractor is allowed extra time for “unusually severe weather” and the kinds of proof that may be needed for presenting a claim.
Obviously, this loss of productivity will include those days when the contractor faces adverse weather, but the contract may also add in those times when delays initiated by the owner push the project timetable into weather conditions that affect performance.
Overtime hours
0vertime in construction can create a backlash, leading to a decline in productivity (up to a 30 percent loss). Yes, there might be an initial goal to speed up schedules or meet deadlines; however, fatigue from prolonged hours influences worker focus, quality and safety, boosting the risk of injury and mental stress, while also impacting equipment maintenance and overall project budget, and even a company’s reputation.
Clearly, there can also be considerable cost overruns due to premium pay.
Work plan modifications
Work plan modifications in construction refer to the process of updating or altering a work plan to accommodate changes in project scope, goals or other significant reasons. This can involve inserting new tasks, fine-tuning timelines or adjusting the allocation of resources. Significantly, if the process stretches out for too long a period, it will have an adverse impact on the overall labor productivity.
Let’s face it, changes in the construction plan take place for numerous reasons. As a prime example, no one will forget how the Covid pandemic affected the construction sector in so many ways.
Crowding and stacking of trades
Trade stacking in construction describes the circumstances where several trades are obliged to work simultaneously in the same area or sequence on a construction site. This often takes place as a result of a condensed schedule, project interruptions or coordination problems that force tradespersons to work at the same time and/or the same place instead of in their scheduled sequential order. The results of trade stacking can consist of rework, delays and cost overruns.
Lack of full access to the construction site
It’s up to the contractor to manage the construction process and take into account the performance methods. This means the contractor has complete, unhindered access to the construction site. As seasoned contractors are well aware, however, that’s not always the case. Normally, lack of access to the site will have a substantial impact on labor productivity since it will undoubtedly produce unexpected delays. This can frequently take place if there is miscommunication with the client.
Absence of sufficient manpower
The absence of adequate manpower on a construction project can lead to substantial project delays, reduced quality control (because of hurried work) mounting costs (mostly due to overtime and inefficiencies) and critical safety concerns. This absence results from workers retiring (including those that took early retirement during the pandemic), a small number of new recruits and a gap in skills. These factors oblige companies to postpone work, boost wages, invest in tech or run the risk of penalties. All this can have an impact on costs, morale and, notably, client satisfaction.
Absence of essential tools
Of course, the absence of essential tools hampers construction productivity by creating postponements, boosting costs, lessening quality and generating safety issues. These factors force workers to apply inefficient manual techniques or, even worse, by waiting for such critical tools, affecting project timelines and ultimate success.
Up to date tools, incorporating digital ones, are essential for speed and precision, while outmoded or missing equipment slows processes, leading to snafus and irritated workers.
On-site injuries
Accidents and an absence of a focus on safety measures can lead to work stoppages and a loss in productivity.
No doubt, dealing with on-site injuries is a huge challenge. After all, if there is a lack of security and an employee is injured, that will undoubtedly have an influence on the workforce’s enthusiasm and general mindset and could give rise to a loss of productivity. Obviously, it’s not within reason to steer entirely clear of all accidents, but employee safety must constantly be steadfast.
The sum of factors
All of these factors can have a serious effect on labor productivity losses in construction. Obviously, a contractor must have that in mind and work towards dealing with any issues a.s.a.p. This best way to sidestep productivity losses is to always be prepared, understanding what might happen.
If, for example, you know there will be delays with the work, it’s a great idea to talk with your employees and make them aware of the circumstances. If they’re prepared for it, they will have a different mindset. Do not keep them in the dark!
Prior to exploring some specific strategies to help overcome productivity losses, let’s look briefly at several myths about productivity
That said, let’s now explore some strategies that could genuinely contribute to increased productivity on construction projects.
Focus on employee training and development
For most any industry, investing in the workforce’s skills is crucial. The construction industry is definitely no exception. Consistent training and upskilling can help improve your employees’ expertise, boost their confidence and encourage them to enhance the quality of their work.
Maintain real-time updates of construction inventory
Inventory management involves assorted processes, consisting of material selection, purchasing, transport and storage. Insufficient inventory control frequently brings interruptions, leading to a loss in productivity.
Relying exclusively on your workers to provide an account of material and tool shortages is insufficient. Project managers and supervisors must oversee regular inventory audits. This guarantees that the necessary construction materials, tools and support are always readily accessible on-site.
Manage overtime effectively
An early sign of overwork is utter exhaustion. Now and then, the effect is as simple as someone arriving late because of oversleeping. Nevertheless, it can add up to a substantial number of productive hours lost.
Construction timesheets perform a critical role in tracking working hours and breaks, allowing managers to keep an eye on observing shift durations. They simplify billing processes and function as a deterrent to overwork and fatigue, everyday issues that can cause on-site accidents.
By logging hours worked, breaks, and jobs completed, a manager can recognize any buildup of overtime and allow them to employ measures such as fine-tuning the workload, job scheduling or, if needed, hiring more workers.
Implementing the right technology
Along with maintaining top-notch equipment, you need to make sure your field crew can make the most of construction field productivity software that helps oversee projects better.
It can be employed as a platform for data collection, workflow automation, accounting, bidding, tracking time, safety supervision, planning, equipment administration and more.
Importantly, be sure workers can employ them remotely by using mobile devices and can execute simple actions, including filling checklists, in the offline mode.
Establish clear communication
Being familiar with how to cooperate with one another is a huge talent for any supervisor.
Where there are accurately designed construction workflows, each stakeholder recognizes what tasks they are liable for, and managers have total project visibility and responsibility, even when in-person get-togethers aren’t possible.
Any issue taking place on the site (accidents, not enough materials, change to plan) is reported in real time via quality inspections, safety reports, etc. This way, problems can be tackled shortly after discovery, reducing interruptions and sidestepping rework.
Mitigate weather-related risks
Yes, weather is impossible to control and can produce disruptions, especially when you plan your project months before. But it can be mitigated with appropriate planning and contract clauses.
By being aware of contractual requirements and adding clauses that offer relief during intense weather, you can proactively tackle would-be weather-related hazards.
Also, by leveraging technology including weather apps, you are given real-time weather data. When hostile weather is predicted, you can reschedule work, amend tasks or even stop activities for the short term. This way, you’ll help ensure workers’ safety and reduce labor stoppages.
Set realistic goals
Impractical project time limits can cause stress, mistakes and lower morale among your people, affecting total productivity in a bad way. To make sure your timelines are realistic, review your accessible resources, including size of workforce and material readiness. Routinely appraise and fine-tune your project schedule based on the information you’ve gathered.
Schedule access to limited equipment
Construction projects often include several teams of differently skilled workers to work simultaneously in the same space. When doing so, they may need access to the same tools and equipment at the same time.
To avoid any frustrations, plan your production schedules for different teams. If necessary, arrange for an extra set of tools that you know will be required by your each crew.
Concluding thoughts
In conclusion, boosting labor productivity in construction demands a pre-planned line of attack focused on scheduling, teamwork and continuous improvement. By getting rid of common myths and implementing useful strategies, projects can realize optimum productivity, sidestep delays and diminish the harmful outcomes that result from poor efficiencies.
Do you need some help in your search for a boost in productivity? Contact the professionals at PDDM Solutions.
However, while the other two sectors have become innovative and reinvented themselves, the construction industry continues to struggle. As stated by the global construction productivity report, construction labor productivity has averaged only one percent annual improvement over the past two decades. In contrast for the same period, the global labor productivity improvement for manufacturing has been 3.6 percent annually.
Labor productivity has long been a challenge for the construction industry. FMI Corporation’s 2023 Labor Productivity Study confirms the trend of productivity decline in the construction industry, with only 23 percent of respondents claiming labor productivity improvement over the past 12 to 18 months. Almost half of the respondents saw declining labor productivity, and a third witnessed stable labor productivity trends in their businesses.
Labor productivity is the economic engine of labor-intensive, self-performing contractors. Labor is also the largest, riskiest, yet most controllable variable cost. Managed well, labor productivity can significantly improve bottom-line margins. Managed poorly, labor overruns or exceeding labor budgets can totally wipe out a contractor’s profitability.
Before we explore the factors affecting construction labor efficiency, plus some ideas on what can be done to improve it, let’s produce a clear-cut understanding of productivity in the construction sector.
Visualize a crew working in an assigned zone, intending to finish a precise amount of work within a set time period. In this scenario, productivity is the successful completion of the allocated tasks by the crew within the designated time, utilizing the proper number of workers.
Let’s now look at those factors shaping construction labor efficiency, followed by some ideas on what can be done to improve it.
Attitude and positive atmosphere
Stress and an uncomfortable atmosphere on the jobsite can create an environment that simply doesn’t contribute to productivity. Increasing conflicts among the workers, disputes, over-inspections, excessive hazards, multiple contract changes, poor site conditions, disruption of work rhythm and more can even lead to project failure.
Weather
Hostile weather is a major source of lost productivity on a construction project. The parties’ contract normally will deal with where the contractor is allowed extra time for “unusually severe weather” and the kinds of proof that may be needed for presenting a claim.
Obviously, this loss of productivity will include those days when the contractor faces adverse weather, but the contract may also add in those times when delays initiated by the owner push the project timetable into weather conditions that affect performance.
Overtime hours
0vertime in construction can create a backlash, leading to a decline in productivity (up to a 30 percent loss). Yes, there might be an initial goal to speed up schedules or meet deadlines; however, fatigue from prolonged hours influences worker focus, quality and safety, boosting the risk of injury and mental stress, while also impacting equipment maintenance and overall project budget, and even a company’s reputation.
Clearly, there can also be considerable cost overruns due to premium pay.
Work plan modifications
Work plan modifications in construction refer to the process of updating or altering a work plan to accommodate changes in project scope, goals or other significant reasons. This can involve inserting new tasks, fine-tuning timelines or adjusting the allocation of resources. Significantly, if the process stretches out for too long a period, it will have an adverse impact on the overall labor productivity.
Let’s face it, changes in the construction plan take place for numerous reasons. As a prime example, no one will forget how the Covid pandemic affected the construction sector in so many ways.
Crowding and stacking of trades
Trade stacking in construction describes the circumstances where several trades are obliged to work simultaneously in the same area or sequence on a construction site. This often takes place as a result of a condensed schedule, project interruptions or coordination problems that force tradespersons to work at the same time and/or the same place instead of in their scheduled sequential order. The results of trade stacking can consist of rework, delays and cost overruns.
Lack of full access to the construction site
It’s up to the contractor to manage the construction process and take into account the performance methods. This means the contractor has complete, unhindered access to the construction site. As seasoned contractors are well aware, however, that’s not always the case. Normally, lack of access to the site will have a substantial impact on labor productivity since it will undoubtedly produce unexpected delays. This can frequently take place if there is miscommunication with the client.
Absence of sufficient manpower
The absence of adequate manpower on a construction project can lead to substantial project delays, reduced quality control (because of hurried work) mounting costs (mostly due to overtime and inefficiencies) and critical safety concerns. This absence results from workers retiring (including those that took early retirement during the pandemic), a small number of new recruits and a gap in skills. These factors oblige companies to postpone work, boost wages, invest in tech or run the risk of penalties. All this can have an impact on costs, morale and, notably, client satisfaction.
Absence of essential tools
Of course, the absence of essential tools hampers construction productivity by creating postponements, boosting costs, lessening quality and generating safety issues. These factors force workers to apply inefficient manual techniques or, even worse, by waiting for such critical tools, affecting project timelines and ultimate success.
Up to date tools, incorporating digital ones, are essential for speed and precision, while outmoded or missing equipment slows processes, leading to snafus and irritated workers.
On-site injuries
Accidents and an absence of a focus on safety measures can lead to work stoppages and a loss in productivity.
No doubt, dealing with on-site injuries is a huge challenge. After all, if there is a lack of security and an employee is injured, that will undoubtedly have an influence on the workforce’s enthusiasm and general mindset and could give rise to a loss of productivity. Obviously, it’s not within reason to steer entirely clear of all accidents, but employee safety must constantly be steadfast.
The sum of factors
All of these factors can have a serious effect on labor productivity losses in construction. Obviously, a contractor must have that in mind and work towards dealing with any issues a.s.a.p. This best way to sidestep productivity losses is to always be prepared, understanding what might happen.
If, for example, you know there will be delays with the work, it’s a great idea to talk with your employees and make them aware of the circumstances. If they’re prepared for it, they will have a different mindset. Do not keep them in the dark!
Prior to exploring some specific strategies to help overcome productivity losses, let’s look briefly at several myths about productivity
- Adding more materials: Contrary to widespread belief, transporting all the materials onto the construction site at the same time can truly get in the way of productivity. Materials scattered about will hinder the crew’s ability to find an efficient way through the construction site.
- Increasing the manpower: Boosting labor past essential levels frequently results in communication issues, interruptions and a better chance for mistakes. It’s critical to maintain the best possible team size for efficient management.
- Boosting costs: Just throwing money at the issue doesn’t ensure a boost in productivity. Working overtime and rewarding quicker work can bring about crew fatigue and harm the quality of the work.
That said, let’s now explore some strategies that could genuinely contribute to increased productivity on construction projects.
Focus on employee training and development
For most any industry, investing in the workforce’s skills is crucial. The construction industry is definitely no exception. Consistent training and upskilling can help improve your employees’ expertise, boost their confidence and encourage them to enhance the quality of their work.
Maintain real-time updates of construction inventory
Inventory management involves assorted processes, consisting of material selection, purchasing, transport and storage. Insufficient inventory control frequently brings interruptions, leading to a loss in productivity.
Relying exclusively on your workers to provide an account of material and tool shortages is insufficient. Project managers and supervisors must oversee regular inventory audits. This guarantees that the necessary construction materials, tools and support are always readily accessible on-site.
Manage overtime effectively
An early sign of overwork is utter exhaustion. Now and then, the effect is as simple as someone arriving late because of oversleeping. Nevertheless, it can add up to a substantial number of productive hours lost.
Construction timesheets perform a critical role in tracking working hours and breaks, allowing managers to keep an eye on observing shift durations. They simplify billing processes and function as a deterrent to overwork and fatigue, everyday issues that can cause on-site accidents.
By logging hours worked, breaks, and jobs completed, a manager can recognize any buildup of overtime and allow them to employ measures such as fine-tuning the workload, job scheduling or, if needed, hiring more workers.
Implementing the right technology
Along with maintaining top-notch equipment, you need to make sure your field crew can make the most of construction field productivity software that helps oversee projects better.
It can be employed as a platform for data collection, workflow automation, accounting, bidding, tracking time, safety supervision, planning, equipment administration and more.
Importantly, be sure workers can employ them remotely by using mobile devices and can execute simple actions, including filling checklists, in the offline mode.
Establish clear communication
Being familiar with how to cooperate with one another is a huge talent for any supervisor.
Where there are accurately designed construction workflows, each stakeholder recognizes what tasks they are liable for, and managers have total project visibility and responsibility, even when in-person get-togethers aren’t possible.
Any issue taking place on the site (accidents, not enough materials, change to plan) is reported in real time via quality inspections, safety reports, etc. This way, problems can be tackled shortly after discovery, reducing interruptions and sidestepping rework.
Mitigate weather-related risks
Yes, weather is impossible to control and can produce disruptions, especially when you plan your project months before. But it can be mitigated with appropriate planning and contract clauses.
By being aware of contractual requirements and adding clauses that offer relief during intense weather, you can proactively tackle would-be weather-related hazards.
Also, by leveraging technology including weather apps, you are given real-time weather data. When hostile weather is predicted, you can reschedule work, amend tasks or even stop activities for the short term. This way, you’ll help ensure workers’ safety and reduce labor stoppages.
Set realistic goals
Impractical project time limits can cause stress, mistakes and lower morale among your people, affecting total productivity in a bad way. To make sure your timelines are realistic, review your accessible resources, including size of workforce and material readiness. Routinely appraise and fine-tune your project schedule based on the information you’ve gathered.
Schedule access to limited equipment
Construction projects often include several teams of differently skilled workers to work simultaneously in the same space. When doing so, they may need access to the same tools and equipment at the same time.
To avoid any frustrations, plan your production schedules for different teams. If necessary, arrange for an extra set of tools that you know will be required by your each crew.
Concluding thoughts
In conclusion, boosting labor productivity in construction demands a pre-planned line of attack focused on scheduling, teamwork and continuous improvement. By getting rid of common myths and implementing useful strategies, projects can realize optimum productivity, sidestep delays and diminish the harmful outcomes that result from poor efficiencies.
Do you need some help in your search for a boost in productivity? Contact the professionals at PDDM Solutions.