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The struggle to hire enough skilled workers is real. Many construction companies are trying to boost their labor pool, and simultaneously control labor costs, while coping with project delays and supply chain disruptions and they’re not alone. The US is forecasted to grow by 3.8%, just shy of global predictions, and that growth is going to be hampered by supply chain issues and labor issues  

Hiring issues have been affecting the construction industry since the pandemic began. According to the Associated General Contractors of America (AGC), construction workforce shortages have reached pre-pandemic levels with 88% of contractors reporting moderate to high levels of difficulty finding skilled workers and 35% of contractors turning down work due to skilled labor shortages. 

 

Here are three steps you can take to help control your labor costs, saving resources so that you can focus on other business challenges. 

Minimize Payroll Waste and Time Theft 

For small businesses, payroll, i.e., your labor cost, can account for more than 50% of gross revenue so controlling waste can have a big impact on the bottom line. When you use paper time cards you rely on workers to fill out the amount of time worked either daily or weekly and manually submit them to payroll. This system poses several issues for construction companies that can seriously cost you time, money and even create compliance risk. Consider how much time theft alone can cost you.  

According to the American Payroll Association, 75% of companies lose money from “buddy punching,” the most common type of employee time theft. “Buddy Punching” is where an employee has a co-worker clock them in or out when they’re not at work. For example, an employee is running late and calls a co-worker who’s on time to punch them in as well. If you have an employee who has a buddy punch them in 15 minutes early, two to three times a week, that stolen time can quickly add up, bloating your labor costs.  

Accurate time tracking can result in big savings. When you rely on paper time cards, clock in and clock out times can be fudged. Consider switching to onsite time clocks or a time card app. A time card app with a biometric time clock and GPS tracking can prevent buddy-punching and wasted travel between locations.  

Make Time Tracking More Efficient 

Manually tracking your labor costs through time tracking can not only take a long time (think deciphering handwriting and manually entering all the time) but can be prone to error. Bookkeepers make mistakes on occasion when entering data by hand. And those errors could pose a compliance risk if there are questions about whether your payroll matches time worked, according to the Fair Labor Standards Act.  

Use time tracking software to streamline payroll-related tasks. Save time for recruiting, training and other business needs by minimizing manual work and simplifying other time-consuming processes. A time clock app like ExakTime can save hours normally spent on collecting and processing paper time cards, and compiling data for required reporting and for business insights, not to mention the savings from increased accuracy and decreased time card fraud.  

Use Data to Manage Teams and Plan Future Projects 

Good data is the key ingredient for managing teams, planning projects and keeping labor costs down. The better the data, the better you can eliminate lost productivity and bloated budgets. According to reports, 68% of trades point to poor schedule management as the key contributor to decreased labor productivity. Accurate and timely data that allows you to track not only worker hours, but how those hours are broken down among various tasks and locations, will help you pinpoint potential waste or labor shortages and quickly adjust.  

Use this data to improve the accuracy of future project bids and plans. This will put you ahead of the competition. Time management and construction scheduling software simplify the collection and recording of this vital information. This software makes it easy to produce reports that provide the vital insights you need to keep your business competitive and profitable.  

Automated time tracking solutions, like ExakTime, make payroll processing more efficient and accurate. Records collected by either the mobile app or ExakTime’s rugged time clocks are stored in the cloud and easily access with ExakTime Connect software in your office, eliminating the need for time-consuming trips to multiple job sites to collect time records. And, with AccountLinx, the data can be synced directly with your payroll program. 

Take your team to the next level.

Download our infographic, “3 Ways to Cut Labor Costs in the Field”, to learn more ways to save money and boost productivity.

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