low productivity in the construction industry
Posted in the Singapore Forum
Construction sector has to build homes better, faster
Feb 9th, 2012 by contributor.
Watch a construction site anywhere around Singapore for a while, and you may start to wonder why it takes so long to build a building or construct a tunnel. You are not the only one wondering.
Last year, the Economic Strategies Committee (ESC) said that “in construction, productivity levels are half that of the United States and one-third that of Japan”. Along with causing slower construction due to lower efficiency and higher costs from needing more staff, that lower productivity creates other difficulties as well.
One is simply the number of workers and the congestion they cause. Recent Department of Statistics data for 2010 showed that about 75 per cent of the more than 394,000 workers in the construction sector were non-residents.
While doubling productivity to US levels doesn’t automatically mean the industry would need 197,000 fewer people, both the number of workers and congestion could drop if productivity rises. Instead of requiring fewer people, however, Minister for National Development Khaw Boon Wan has said the sector may need 27,000 more workers from abroad over the next few years to build Housing and Development Board (HDB) flats.
Another issue is the quality of construction. Contractors here often use non-standard sizes for windows and doors or other materials, which can reduce quality and may result in leaks or other defects. Standardisation can enhance quality and, as the Building and Construction Authority’s chief executive John Keung said, solutions like using prefabricated materials can “ensure higher quality and consistency”.
Mon, Mar 22, 2010
The Straits Times
WANTED: S'porean construction workers
WANTED: More Singaporeans to operate cranes, wield electric drills and supervise workers on building sites.
This is the clarion call in the construction industry after the Government sounded the alarm on its low productivity and over-dependence on poorly skilled foreign labour.
As much of this foreign labour is transient, one obvious solution is for the industry to attract and retain more Singaporeans, particularly as skilled workers, supervisors and managers.
The problem: Construction is a tough sell for the average Singaporean diploma or degree holder, say industry insiders.
Work can go on for 12 to 14 hours a day and spill over onto weekends. Then there is the rough-and-tumble, high- pressure nature of the job, and its vulnerability to economic fluctuations.
As few Singaporeans are willing to come on board, foreign workers have to be shipped in by the truckload to keep the industry growing, say industry players.
But such inefficient use of labour is unsustainable. Hence construction has been singled out as the sector most in need of a shake-up, after the Government unveiled a productivity-based growth strategy in its latest Budget earlier this month.
Sobering statistics show productivity levels in Singapore's construction industry to be half those of Australia, and one-third those of Japan.
Construction productivity here fell every year in the second half of the 1990s. In the last 10 years, on average, the sector has mustered 0.7 per cent annual productivity growth, but that is not enough.
For every Singaporean working in the sector, there are two foreign workers. Today, there are 245,000 foreigners employed by the industry, compared with 110,000 Singaporeans.
The majority of locals are professionals, managers, executives and technicians (PMETs). On any given worksite though, over 90 per cent of workers are foreign.
As the statutory board overseeing the sector, the Building and Construction Authority (BCA) is making a big push to draw more Singaporeans on two fronts.
First, it will expand its one-year-old training and certification scheme for skilled local workers and foremen to include supervisors.
Trades currently covered by the scheme, known as the Construction Registration of Tradesmen or CoreTrade, include construction plant operation and electrical and plumbing works. Other high-value trades like dry-wall and lift installation will be added, and training subsidies increased.
'To attract more locals, our approach is to focus on the higher value-adding trades and supervisory positions, which offer better pay, more conducive working conditions and better progression prospects,' says BCA's chief executive officer John Keung.
Such trades have a starting pay of $1,400 to $1,700 a month for new workers, compared to non-CoreTrade work such as painting, where workers start with a monthly salary of $900 to $1,400.
New supervisors can earn at least $1,600 to $2,200 a month for starters.
Secondly, BCA wants to bring in young PMETs by increasing the value of scholarships on offer, and conducting more career talks in schools.
All these aside, Dr Keung acknowledges that the labour-intensive industry will continue to need foreign workers.
During the Budget debate, measures were announced to curb construction noise on weekends. By next year, a total ban on work on Sundays would effectively give construction workers a day off.
This might help get more locals into the workforce as 'one of the main complaints is the long working hours', says Mr Desmond Hill, deputy general manager of a large foreign construction firm.
BCA aims to raise construction productivity
13 October 11 | The Business Times
by Uma Shankari
THE Building and Construction Authority (BCA) aims to raise construction sector productivity by 20 to 25 per cent over the next 10 years.
The industry regulator released the target yesterday after National Development Minister Khaw Boon Wan delivered an addendum to President Tony Tan Keng Yam's address in Parliament on Monday.
'As we undertake more complex construction and infrastructure projects in a denser Singapore, we will need to raise the capabilities and productivity of our construction industry,' said Mr Khaw.'This is also to reduce our reliance on foreign workers.'
Earlier this year, the BCA rolled out a new roadmap to help construction firms raise their productivity and combat rising costs.
Among other things, the agency said it will regulate the demand and supply of foreign labour through higher levies for foreign workers.
'Like many other industries, the construction sector is not without its unique challenges, one of which is low productivity,' BCA said yesterday.
'The low productivity is attributed mainly to the easy availability of low-cost foreign workers. This in turn has led to little incentive for contractors to invest in technology adoption and labour optimisation.'
BCA set up the $250 million Construction Productivity and Capability Fund in June 2010.
The agency said in an update yesterday that more than $26 million from the fund has been committed to firms in the construction sector. Of the amount, about $22 million was allocated for technology adoption, while the remaining $4 million was set aside for workforce development and capability building. In all, about 900 companies have benefited from the scheme, of which 60 per cent are smaller firms.
The productivity improvements range from 20 per cent to 60 per cent, BCA said.
Mr Khaw also said that the government will step up efforts in greening Singapore's buildings to make them more energy efficient and environmentally-friendly.
Construction jittery as levy hike is spelt out
24 February 10 | The Business Times
by Uma Shankari
(SINGAPORE) AS the Ministry of Manpower (MOM) released more details on the planned increases in foreign worker levies, the construction industry said that it would be hit hard. Some contractors may try to pass on the costs.
The construction sector - which has been singled out for its low productivity numbers - will bear the brunt of the changes. The least impact will be felt by firms in the marine industry, which will see only slight increases in foreign worker levies as the sector has high productivity levels.
Foreign worker levies were also raised for the manufacturing, services and process (the building and maintenance of equipment in the petroleum, petrochemicals, specialty chemicals or pharmaceutical industries) sectors. But there is also no change in the dependency ratios for all industries.
Hiring workers on S passes will also be costlier.
The first round of hikes will take place in July this year, with subsequent increases until July 2012. Generally, the changes mean that more workers in each company will now be classified under the more expensive levy categories. The rates for most levy categories have also been bumped up.
MOM's announcement comes on the heels of Monday's Budget, when Finance Minister Tharman Shanmugaratnam said that Singapore is raising its foreign worker levies in a bid to get businesses to restructure and upgrade their operations and rely less on lower skilled foreign labour.
'If we make low-cost foreign workers too readily available, employers will not have sufficient incentive to upgrade their operations and upskill their workers,' he said.
On the ground, firms in labour-intensive industries such as construction, hospitality, manufacturing and shipping voiced their apprehension at the impact on their bottom lines.
Companies in the construction sector will see a 25 per cent cut in the man-year entitlement (MYE), which refers to the total number of foreign workers a main contractor is entitled to employ based on the value of projects and contracts the company has been awarded.
MOM will also phase out unskilled work permit holders in the sector from July 2011. Existing work permit holders would only be reclassified as 'basic skilled' if they possess a Skills Evaluation Certificate. A 'higher skilled' tier for work permit holders with the relevant experience and qualifications will also be introduced.
Simon Lee, executive director of industry body Singapore Contractors Association Limited, said that the levy increases will affect contractors' cashflow.
For ongoing projects, contractors would have underestimated their costs when they tendered as they were unaware of the coming levy hikes and could now face difficulties.
Mr Lee added that the public sector should also set the example when it comes to compensation in such cases.
But for future projects, at least two contractors BT spoke to said that they would pass on the increased costs brought on by the levy hikes.
First group of Sri Lanka, Philippine construction workers for Singapore
By Saifulbahri Ismail
POSTED: 26 Jun 2013
SINGAPORE: Singapore will soon see its first group of construction workers from Sri Lanka and the Philippines.
Those from Sri Lanka are expected to start work in September this year, and those from the Philippines a month later.
The Building and Construction Authority (BCA) said that for a start, Singapore is bringing in about 200 Sri Lankan and 200 Filipino workers a month.
Four Overseas Training Centres in Sri Lanka and another four in the Philippines have been given approval from the relevant authorities to train and recruit the workers.
The training centres are operated by six Singapore construction companies.
Sri Lanka and the Philippines have been identified as new sources of foreign workers to cope with the construction boom in Singapore.
Tiong Aik Construction runs a training and testing centre for foreign construction workers in Singapore.
It is also one of four construction companies that will be operating a training centre in Manila.
The company received the green light from the Philippine government in April this year.
Training centres are being set up to prepare skilled Filipino construction workers before they can start work in Singapore.
A significant number of them are skilled workers after gaining experience from working in the Middle East.
Marketing campaigns have begun, but there has been some resistance.
Mr Neo Tiam Boon, CEO and Executive director of Tiong Aik Corporation, said: "They feel that look I have five to 10 years of experience. I'm very skilled why should I comply, but the fact is there is a requirement in Singapore. You have no choice but to comply. So we will do a basic training for them, what we call the SECK (Skills Evaluation Certification Knowledge) to comply with the BCA requirements before they could be brought into Singapore."
Mr Neo Choon Keong, "group Director of Manpower and Strategies Policy at BCA, said: "Even though they are actually experienced, there are differences in terms of the work methods, the work processes, or even the work standards because our home owners and users are generally more demanding. It also allow us to in a way to verify indeed they have the required test standards because if we don't have a third party verification we can't ascertain what kind of skill level they possess because we just can't look at their declared experience."
The training period for Filipino and Sri Lankan construction workers will be shorter than for most others because of their skill and work experience.
They will go through two months of training. Unskilled workers usually have to undergo up to six months of training.
Their pay is also expected to be higher. They may also get more than what they used to receive when working in the Middle East.)
Mr Neo Choon Keong added: "If the Filipino workers are indeed skilled and experience, they should command a much higher pay compared to the Indian and Bangladeshi workers. Just to give some sense, the Indian and Bangladeshi new workers usually command about S$18 to S$20 basic pay a day. So, I think for the Philippine (workers) they should be able to command between S$20 to S$30 because the China workers are commanding higher than S$30 per day as they are even more skilled."
BCA believes market forces will ensure fair wages for workers from the Philippines and Sri Lanka. It is also confident that these workers will be in good demand.
There are more than 270,000 construction workers in Singapore, most of them from China and India.
Besides the eight Overseas Training Centres in Sri Lanka and Philippines, BCA will be building two more, one each in India and China by next year.
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