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73R-13: Establishing Labor Productivity Norms

73R-13: Establishing Labor Productivity Norms
AACE International, January 14, 2014

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This recommended practice (RP) provides principles and key attributes of construction project labor productivity norms or reference bases which most practitioners would consider to be a foundation for good labor norm practices that can be relied on and that they would recommend be considered for use where applicable. This RP may also be applicable in non-construction related industries. Labor resource requirements are a key element of project estimates, schedules, resource management and risk management plans.

In terms of valuation, the purpose of a labor norm is not to provide true values for every situation. Its purpose is to provide logical, reliably consistent values; and a practitioner should know how to adjust the labor norms to the situation based on an understanding of the labor norm’s explicit basis. It is understood that every estimate will require adjustment to the base labor norms. It is also understood that every organization’s needs differ and there is no single best labor norm and no standard cross-labor norms set of adjustments. However, this RP outlines what should be considered in developing an in-house labor norm or selecting an external labor norm and developing adjustments.

Labor hours used in estimates and other tasks, and the labor norms they are based on, must consider issues that affect productivity such as organization, culture, motivation, skills levels (sometimes all encompassed in location factors), indirect and overhead resources, risks, work conditions, worker morale, safety practices, fatigue and other drivers of productivity. This RP does not address the costing or pricing of labor; it only addresses the basis of hours. It also does not address contract forms.

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