Top tips on pricing labour

I was going through all the blogs I’ve written before – there are a lot! And I realized that there was a topic that I probably hadn’t given you all the info on in one read before, and that is measuring labour.

So here you go in all its glory…

My Blow-By-Blow On How To PROPERLY Measure Labour.

1. Your labour measure comes from your materials measure. If you haven’t already, go grab yourself a copy of the ASNZ Standard Method of Measurement. This puppy is a great guideline around how each item should be measured, and it will look like gobble-dee-gook, to begin with, but as you start working through it you will realise there is a method to the madness. It is laid out trade by trade, so irrelevant of what part of the construction world you come from, this is a VERY useful document.

1. To drill down a bit further, what the standard effectively asks you to do, is to measure every material in categories. A stick of timber used as a stud, versus that same piece of timber used pinned together to create a lintel (just as an example) takes DIFFERENT AMOUNTS OF TIME. It is THIS concept that will properly rock your world once you get your head around it.

1. So what you should end up with is a list, and it will look something like; – 90*45 H1.2 jack studs – 90*45 H1.2 bottom plate – 90*45 H1.2 top plate…… and so on.

1. In general, the rules are to start with the largest timber members and work your way down to the smallest, every description of material needs to have what it is, what the treatment is, and what it’s doing.

1. How does this relate to the labour I hear you ask? Well, once you have this list, you can then work through and apply LABOUR CONSTANTS to each item. The definition of a labour constant is…. ‘The average guy, on an average day, doing the average job’. It is effectively the fraction of an hour taken to complete a task on a per-unit measure, so for instance, it takes 0.13 of an hour per linear metre of 90*45 H1.2 to install a bottom plate…..
   

1. Where on earth do you find these magical labour constants I hear you say? There are several places, online tools such as QV Costbuilder holds a treasury of them. Or my favourite is the little book ‘A Ready Reckoner’ by Toni Craig and Alan Muxlow. If you don’t have a copy of this book I HIGHLY recommend you look it up and buy it asap.

1. So why should you listen to some little book? These resources contain years and years of averaged data, so they are a brilliant place to start. What happens if your guys are faster? Well, once you get your head around the concept, you will start to figure out how much faster or slower your team might be, and you can start to adjust the labour constants you use accordingly.

Do it yourself

The bottom line with all of this is that your materials measure MUST be accurate if it is not, then your labour will be completely thrown out. So DON’T use a merchant measure to apply labour constants to, go old fashioned and measure it properly yourself.