IMPROVING PRODUCTIVITY IN THE CONSTRUCTION INDUSTRY THROUGH I-HUMAN RESOURCES DEVELOPMENT
ABSTRACT
The purpose of this study was to investigate the effect of Human Resource Management (HRM) practices on productivity in the construction industry in Uyo. The study was guided by four specific objectives: to establish the extent to which human resource management practices are implemented in the construction industry ; to identify factors affecting productivity in the construction industry ; and to investigate the effect of human resource management practices on productivity in the construction industry in Uyo. In order to achieve the research objectives, the study adopted a quantitative research technique whereby explanatory research design was applied since very little has been carried out on the topic under investigation, which also involves a relationship between human resource practices and labour productivity. Systematic sampling of construction managers was carried out. A sample size of 105 respondents was obtained, located on 35 construction sites. However, the investigation involved 65 (61.9%) respondents, working on 35 sites that were accessible during the study. Questionnaires were the main research instruments used to collect data from the respondents which formed primary sources of information. The filled-up questionnaires were returned by 43 masons and 22 construction managers. The response rate was therefore 61.4% and 62.9% respectively. Books, journals and the internet provided secondary sources of information.
According to the research results, the HRM practices to be investigated were performance appraisal and reward management; training and development; recruitment and selection; health, safety and welfare; employee engagement and employee relations. Various factors influencing labour productivity were established, which comprised relevant task force, sufficient tools and equipment, conducive environment, and availability of materials. The respondents’ views concurred with the fact that HRM practices identified in this study have an effect on the labour productivity. Based on the findings of the investigation, it was therefore, concluded that “There is a direct relationship between Human Resource Management practices and labour productivity in the construction industry in Uyo. Human labour which is the main factor of production in the construction process ought to be given the attention it deserves by ensuring that masonry employees are well taken care off in order to improve the productivity on construction sites. This can only be achieved by
incorporating most of the human resource practices not being practised on construction sites such as recruitment & selection, training & development, performance & reward management, employee relations and employee engagement. Safety, health and welfare, the only practice that is being implemented on most construction sites should be further developed to ensure that all sites embrace it including small residential developments. Implementation of all these practices can only be enforced by the National Construction Authority if labour productivity in the construction industry in Uyo, is to be improved. This success will cause a paradigm shift in the entire construction industry in Kenya from low labour productivity to high productivity.
CHAPTER ONE
INTRODUCTION
Background to the study
Human Resource Management (HRM) is of strategic importance in all organizations. It contributes to the success of the organization and creates competitive advantage for the organization (Rana & Rastogi, 2010). The way HRM practices and policies take shape also affects the employee’s experiences of work and the employment relationship (Sambasivan, 2007). HRM is therefore important in any organization. The construction company is no different in this regard. However, the researcher suggests that specific features of the construction company create specific challenges for HRM in that context, which are not widely recognized in the general management, HRM or project management (PM) literatures (Thomas, 2012).
Construction is a process that consists of the building or assembling of an infrastructure. Large scale construction is a feat of multi-tasking. Normally the job is managed by the project manager who acts as the representative of the client/developer (Hills et al., 2008) while the construction manager is tasked with the role of supervising; the construction works, design engineer, construction engineer or project architect (Rojas & Aramvareekul, 2013). For the success of construction of any sustainable development project, many aspects must be taken into consideration, inclusive of planning and management, such as human resource, safety and health, construction delays, the designs of architecture and engineering, material availability and quality; the clients need, and financial or economic limitations.
In this age of rapid growth of globalization, many construction firms focus on the effective use of Human Resource Management (HRM) practices to gain competitive advantage to achieve the organization’s objectives and ensure optimal performances among the employees. Construction industry is an important part of the economy in many countries and often seen as a driver of economic growth especially in developing countries. Typically, construction industry contributes to 11% of Gross Domestic Product (GDP) in most developing countries
(RoK, 2003). The Kenyan construction industry is one of the most important sectors in the country’s economy whose level of activity is an indicator of the general economic performance of the country. It contributes about 4% of the country’s G.D.P and currently employs 80,000 persons. In the last five years, the construction industry has been on decline mainly because the government, who is the sector’s largest and most influential client, has reduced its development expenditure drastically in line with the prevailing economic climate particularly the structural adjustment program and reduction of donor funds (KNBS, RoK, 2012).
The nature of construction industry, presents challenges and peculiar requirements in the developing nations (Ofori 1999). In order to check on performance and productivity, some measures in the construction industry have to be taken at various stages of socio-economic development. Many countries have set up special agencies to monitor the operations in this industry and harness their potential for improvement, although they have different objectives, responsibilities and levels of authority. The Construction Industry Council, for example in the UK, is a board which was initiated by the players in the construction industry to represent and support these players at national level. However, in developing countries like Kenya the counterpart agencies like National Construction Authority and the National Construction Council of Tanzania (Miles and Neale, 1991) are government agencies controlled and managed by the government. The agencies in developing nations therefore are restricted in their mandate rather than as assigned by the government authorities. In doing so, they are likely to exclude key players in the construction industry especially the masons and casual labourers.
Productivity happens to be a significant aspect of construction industry that may be used as an index for efficiency of production. Productivity is defined as a relationship between output produced by a system and quantities of input factors utilized by the system to yield that output (Mbiti, 2008). Productivity is considered one of the most outstanding factors influencing timely completion of a project and cost control in all construction projects. Efficient management of construction resources can lead to higher productivity that can help to achieve cost and time savings (Sebastian & Raghavan, 2015).
Productivity remains an intriguing subject and a dominant issue in the construction industry, promising cost savings and efficient usage of resources. However, Rundle (1997) identified construction productivity as a cause of great concern. Ghate and Minde, (2016) concurred with Rundle’s views in observing that construction productivity seems to have declined. On the other hand, Lawal (2008) reported that in Nigeria, construction workers in the public service have almost zero productivity. Kothari (2004) identified poor productivity of craftsmen as one of the most daunting problems confronting the construction industry especially in developing countries.
Olomolaiye et al (1998) briefly studied labour productivity on construction sites in Nigeria. Their study concluded that there was a need for establishing output figures on various
construction sites through time study techniques. It was concluded that method studies and research results should be disseminated not only to large firms but also to small firms so the most productive working methods (or best practices) could be adopted by operatives, resulting in increased output without necessarily increasing physical effort.
Lim et al (1995) studied factors affecting productivity in the construction industry in Singapore. Their findings indicated that the most important problems affecting productivity were: difficulty with recruitment of supervisors; difficulty with recruitment of workers; high rate of labour turnover; absenteeism from the work site; and communication problems with foreign workers. Olomolaiye et al (1996) studied factors affecting productivity of craftsmen in Indonesia, with their findings indicating craftsmen in Indonesia spent 75 % of their time working productively. Five specific productivity problems were identified: ie lack of materials; rework; absenteeism; lack of equipment; and tools.
Wachira (1999) did a study in Kenya construction firms and found that that labour productivity is affected by many factors including, experience of the workforce; motivation; organisation of the work; type and condition of tools and equipment; and continual monitoring of performance. Tahir et al., (2015) observed that a lack of skilled labourers’ low amount of pay, working seven days per week without taking a holiday, drawings and specifications alteration during execution of project and poor relations between labour and supervisors were the key issues. In another study, Lamka (2015) identified three major factors that affect labour productivity in masonry and painting namely; lack of training/skills, work planning & scheduling and incompetent supervisors. A critical look at these factors reveals that they are hinged on the human resource management practices. As summed up by Sebastian and Raghavan (2015), lack of proper managerial efficiency is the basic reason for all these issues. Pardo and Fuentes (2003) stated that 15% of productivity loss occurs due to resource management and 25% loss due to working environment. Ghoddousi (2015) revealed that Chief Executive Officers (CEOs) regard major aspects of human resources management as the most effective factors to increase productivity in construction projects. Monetary features of human resource management such as amount, timeliness of payments and remuneration, as well as intrinsic aspects e.g. satisfaction, ethical behaviour, promotion, individual relationships and job security were among the factors perceived by CEOs as the most influential determinant of productivity in road projects in Iran (Makulsawatudom, 2001).
Although many studies have strived to explain the effects of human resource management practices on the performance of employees in the construction companies, a few have carried out an empirical study on the effect of human resource management practices on productivity and none has looked at the moderating effect of employee engagement on labour productivity in the construction industry in Uyo, Kenya. This research was, therefore, to fill the gap by carrying out an empirical study to establish the effect of human resource management practices on labour productivity.
Mbiti (2008) in his study in Kenya found that, there is an abundance supply of semi-skilled and unskilled labour which needs to be utilized. In order to provide social and economic advantage to the population, the construction industry has been under pressure to embrace best practices as one way of creating job opportunities for operatives in the job market. Construction process is an important means of expanding the job market in the economy and therefore every effort should be made to improve labor productivity. An improvement in labor productivity will lead to enhancing project productivity and making it attractive to project sponsors.
The labor productivity on site might be affected negatively by a variety of factors which include; extraneous reasons like adverse effects of the weather, NCA, NEMA, local authorities, stakeholders and legislation. Masu (2006) argues that Kenya being a developing country is not an exception to the trends in other countries which are at crossroads with the building teams due to the later not delivering the projects within the stipulated time.
Delays on site has caused losses on project’s profit to the contractor; increased cost to the client and strained the working relationship between the parties in a project. This has been brought about by the lack of adequate information on labor productivity rates in the construction industry in Kenya (Wachira, 1999). The inaccurate determination of activity duration has in most cases led to the incorrect estimation of contract periods. Delays in completion of projects in the construction industry are indicators of productivity problems and hence a big challenge facing the construction industry. An improved labor productivity is one of the key determinants of projects prediction and therefore an important ingredient of construction delivery.
1.1.1 Construction Trades
Gruneberg (1992) asserts that construction trades were undertaken by master craftsmen organized into guilds during the medieval period, between the approximate dates of 1200 to 1600. Each guild represented a different craft, and each craft was based on a different material such as lead, wood or stone. In this way craftsmen were divided into trades. The author further explains that in the twentieth century changes took place in the construction labour force resulting to huge numbers of workers enrolled into various trades after the First World War.
The number of woodworkers increased drastically and in 1973, 13 percent of all employed operatives were carpenters and joiners by far, the largest craft. Painters followed with 9 percent and brick layers 7 percent while electricians, plumbers and other crafts made up the remainder.
Construction materials have evolved with time hence the change from extensive use of timber to brickwork, blockwork and concrete as walling materials. This has caused a paradigm shift from high numbers of woodworkers to high numbers of masons according to National Construction Authority (NCA) workers classification by trades. Masons form the highest percentage of workers at 55.1%, followed by Carpenters at 12.3% and steel fixers at 5.1%. Other trades share the remaining 27.5% as illustrated by the table below.
Table 1.1: NCA Classification of construction workers by trade.
| Trade | Number of workers | Percentage | ||||
| Masons | 72,612 | 55.1 | ||||
| Carpenters | 16,841 | 12.3 | ||||
| Steel Fixers | 6,939 | 5.1 | ||||
| Supervisors | 6,115 | 4.5 | ||||
| Electricians | 5,892 | 4.3 | ||||
| Painters | 4,889 | 3.6 | ||||
| Welders | 4,195 | 3.1 | ||||
| Plumbers | 4,038 | 2.9 | ||||
| Machine Operators | 2,010 | 1.5 | ||||
| Tile Fixers | 1,577 | 1.1 | ||||
| Drivers | 442 | 0.3 | ||||
| Surveyors | 425 | 0.3 | ||||
| Glaziers | 134 | 0.1 | ||||
| Scaffolders | 100 | 0.1 | ||||
| Interior Decorators | 93 | 0.1 | ||||
| Aluminium Technicians | 90 | 0.1 | ||||
| Asphalt Specialists | 85 | 0.1 | ||||
| Terrazo Fitters | 75 | 0.1 | ||||
| Others | 802 | 0.6 | ||||
Source:Report on RRI for Registration of Skilled Construction Workers and Site Supervisors (November, 2015) page 16.
1.1.2 Masonry Labor
The layering and joining in building to enable the surface communicate to its intended activity in an extra-ordinary variety, while using construction materials is a process commonly known as masonry. The masonry labor activities in the construction industry include; plastering, mixing mortar, laying blocks/bricks, cutting blocks, tile setting, pointer-cleaning or-sealing, refractory, marble setting, terrazzo laying and finishing. The professionals in this trade work inside and out at substantial heights and ground level and grouting (City of Seattle, 2019).
Masonry workers perform some roles to the building. The following roles were identified during extensive observations conducted in a masonry project and are complemented. The masons perform the tasks of block/brick laying, installation of beams and bars and wire for reinforcement, and set up door frames. The mason may also perform support work, e.g., cementing and building layout (Florez & Castro-Lacouture 2014). The Construction manager is responsible for staffing and sourcing for qualified masons, allocates duties and stations to personnel in the projects. The foreman performs the roles of monitoring the masons and their assistants, the layouts to the buildings, plans and distributes tasks, orders materials and equipment, performs quality control, and harmonizes working areas with other foremen (electrical, plumbing, mechanical) (Castro-Lacouture, 2014).
The construction industry consists of other building trades or crafts which include; the iron or steel trades, cement masons (masonry) trade, carpenters trade, heavy equipment operation trade, pipe and mechanical fitting trade, sheet metal and roofing trade and painting trade. The masonry trade is the lagest trade with an estimated total labour input which takes up to 50% of the total cost of a project ( Loganathan1 and Kalidindi, 2015). Therefore based on the level of labour in masonry trades, due to the high number of workers and the fact that masonry works comprise the bulk of works undertaken on construction projects, the study on HRM practices in masonry labour will explicitly address adequate labour issues in the construction industry.
Kenyan construction industry has attracted large amount of capital over the years in order to mitigate the housing shortage and the infrastructure deficit. This has in-turn created some economic benefit through improvement in construction business and employment creation especially to artisans. Subsequently, a sizeable degree in growth of the Gross Domestic Product (GDP) has been made for the country (Ganesan 1997; Crosthwaite, 2000). Ogunsemi and Jagboro (2006) reinforced this argument while stating that property development industry attracts the era of job creation and growth in monetary value.
The accessibility of labor is extremely urgent and establishes the segment of asset information necessary for the construction works (Sanni and Alabi, 2008). Labor needed for construction works include; Architects, Urban and Regional Planners, Masons, Engineers, Quantity Surveyors, Estate Managers and building artisans like bricklayers/bricklayers, craftsmen, welders, house painters, handymen, circuit repairmen and the preferences. Generally, the huge amount of labor required in construction works are artisans and workers (Sanni and Alabi, 2008). Therefore, the artisans together with the experts in the masonry works as a trade in construction industry represents one of the two noteworthy classes of labor/players required in the industry (Kwame, 2016).
Labor productivity is one of the most important factors that affect the physical progress of any construction project. In order to improve labor productivity, site production should be measured on a regular basis, and then compared to acceptable standard benchmarks. The masonry activities are labor dependent and require a large number of workers with diverse skills. The effect of masonry on labor productivity through determining and quantifying these effects is required for estimating, planning, scheduling, and evaluating performance among others (Han & Lee, 2008).
The determination of labor productivity in masonry construction has not been exhausted explicitly with many studies not quantifying the factors. There are a variety of issues that give rise to this challenge and disagreement in addition to the difficulty of defining and quantifying productivity. The complexity of the construction environment itself and the fact that there are many different workers with different skills involved in each project, the significant variation in terms of the size of masonry construction projects, and also the different type of methods that have been used for productivity measurement have all made productivity metrics definition for the masonry construction industry a challenging task (Ghebregiorgis and Karsten, 2006). As a result, efforts and research in terms of improving productivity measurements have remained an ongoing task as seen from above. However, there is no study on the influence on productivity of interaction terms, that is, the relation between masons and between masons and site characteristics Huselid, (1995).
1.2 Problem statement
Unlike other industries, construction industry is mainly project-based. The construction projects have the general characteristics of limited budget, schedule, and quality standards with a series of complex and interrelated activities. According to Burke (2010), it requires the cooperation of all project participants that includes clients, directors, designers, contractors, constructors, project managers, project team and consultants. There are many human resource issues that will lead to poor performance of construction projects such as poor project work design and structure, shortage of qualified skilled employees, changing workforce demography, a high rate of employee turnover and high rate of burnout among construction workers (Levy, 2000).
The shortage of qualified skilled employees is also one of the common issues among the construction firms. According to Borcherding (2009), there is a “disturbing trend” in construction in which there is a “growing shortage of skilled workers and experienced managers”. He further claimed that “the scarcity of both skilled trades-people and experienced managers will place more emphasis on the need to increase the quality and quantity of training in order to produce more effective and productive workers. Therefore, due to the lack of proper screening process, selection methods and poor recruitment procedure will affect badly on the success rate of the construction projects and therefore lead to low productivity and growth of the construction firm (Enshassi, 2007).
In the construction industry, the labor market is always changing and modifying due to the reduction of qualified workers and also due to the changing demographics of the workforce. One of the factors is due to the aging of construction workforce that is growing older over the long term. Therefore, human resource management has become more important to the construction industry to overcome the changing workforce demographics (Heizer & Render, 1990).
There is undeniably a high rate of employee turnover in the construction industry nowadays. According to Horner (2011) the two major factors that cause employee termination is “perceived ease of movement” and “perceived desirability” that related to employee’s career satisfaction. Employee voluntary and involuntary termination are mainly due to poor job performance, absenteeism or violation of workplace policies, firing or discharge, or leaving the company of her own volition, relocating to a new area or other reasons. The worst consequences of the high employee turnover are the loss of talent, loss of productivity, waste of time and cost to train a replacement. It is estimated that the cost is almost twice of an employee’s salary to find and train a replacement, and might damage morale among existing employees.
Despite the concerns on lack of adequate productivity information, little research attention and documentation has been undertaken on construction sites to establish labor productivity data for consideration in project planning, costing and budgeting in the construction industry in Kenya. Therefore, this study seeks to assess the effect of human resource management practices on productivity in the construction industries in Uyo.
1.3 Objectives of the Study
The study was guided by a main objective and specific objectives. They are:
1.3.1 Main Objective
The main objective of this study was to determine the effect of human resource management practices on productivity in the construction industry in Uyo.
1.3.2 Specific objectives
- To establish the extent of human resource management practices in the masonry labour within the construction industry.
- To investigate the level of Labour Productivity in Masonry works within
- To identify factors affecting human resource management practices in the productivity within construction industry.
- To investigate the effect of human resource management practices on productivity in the construction industry.
1.4 Research Questions
- To what extent are the human resource management practices in the masonry labour within the construction industry?
- What is the level of Labour Productivity in Masonry works within Uyo?
- What factors affect human resource management practices in the productivity within construction industry?
- What are the effects of human resource management practices on productivity in the construction industry in Uyo?
1.5 Hypothesis
The hypotheses for the study were as follows:
Main Hypothesis
H0: Human resource management practices have no significant effect on productivity in the construction industry in Uyo.
H1: Human resource management practices have a significant effect on productivity in the construction industry in Uyo.
Sub hypotheses Sub hypothesis 1
H01: Reward management practices have no significant effect on productivityin the construction industry in Uyo.
H11: Reward management practices have a significant effect on productivity in the construction industry in Uyo.
Sub hypothesis 2
H02: Recruitment and selection have no significant effect on productivity in the construction industry in Uyo.
H12: Recruitment and selection practices have a significant effect on productivity in the construction industry in Uyo.
Sub hypothesis 3
H03: Employee relations have no significant effect on productivity in the construction industry in Uyo.
H13: Employee relations have a significant effect on productivity in the construction industry in Uyo.
Sub hypothesis 4
H04: Employee engagement has no significant effect on productivity in the construction industry in Uyo.
H14: Employee engagement has a significant effect on productivity in the construction industry in Uyo.
1.6 Significance of the Study
This research serves as reference for construction firms. The findings led to establishment of appropriate human resource management practices that could increase labour productivity in the construction industries. The results of the investigation could also be used as a useful benchmark tool for other contractors who may not have been adhering to the set standards and best practices.
A competitive advantage should be established as a result of implementing the findings of the study. Human resource management practices contribute significantly to creating a competitive advantage by creating human resources, which are unique and difficult to replicate, therefore, contributing significantly to labour productivity. Human resources are the most important asset of an organisation but very few are able to fully harness its potential.
The findings from the study will be valuable in the construction industry as they prioritize the factors that are associated with effective labor productivity on construction site. This would assist the planning for the resources to be used in the execution of the work and thereby improve labor productivity. The findings will further contribute to the pool of knowledge available in this area of construction project management and would form a useful archival material for reference to other researchers and institutional libraries which will be vital to the present and future scholars in regard to labor productivity.
A body of knowledge on effect of human resource management practices and productivity has been created, since few pieces of research have been carried out on this subject. The knowledge shall be used by scholars for teaching purposes; contractors can utilize it to increase their labour productivity, leading to reduced costs and number of craftsmen in masonry work, in order to create a conducive working environment. Improved labour productivity in construction industry will definitely lead to timely completion of works within project time frame and budget. The outcome of this investigation, shall hopefully contribute to high standards of workmanship as a result of incorporating efficient HRM practices into management of employees in construction companies and sites.
1.7 Scope of the Study
This study investigated the effects of human resource management practices on productivity in the construction industry in Uyo. The construction industry involves a wide range of works that include both building and civil engineering works.
The researcher focused on building projects undertaken by contractors registered under National Construction Authority (NCA), classified as NCA1 and with construction sites based in Uyo. This category of construction firms are the industry leaders hence best practices by these firms will be easily benchmarked upon by the other categories of contracting firms.
Building works involve various trades but this research project is particularly investigating masonry trade which is a major activity in the construction industry. The focus on masonry works as a trade is also because of limited time and finance for the field work. Masonry is a building trade that is predominant on construction sites and it is usually a labour-intensive practice in the construction industry. The total labour input of masonry works takes up to about 50% of the total cost of a project (Loganathan1, and Kalidindi, 2015). The area covered in a day is easily measurable hence its productivity easily monitored.
1.8 Assumptions of the Study
The assumptions of this study were:
- Most of the contractors engaged in formal and informal construction work are registered with the National Construction Authority.
- The gang sizes for labor on construction sites vary from one type of operation to For the purpose of this study, it was assumed that construction sites engage more or less the same gang sizes for similar operations.
1.9 Limitations of the Study
The researcher encountered the following barriers and challenges. First, the findings could have been influenced by the researcher’s subjectivity. The researcher addressed this by comparing her personal views with literary sources so as to minimize subjectivity. Second, some respondents for one reason or another withheld important information from the researcher, forcing the researcher to re-assure the participants of the confidentiality of the information she was obtaining from them so that they freely open up to give the information. Third, the interviews that were used in the data collection despite having many advantages were time- consuming and costly. The researcher overcame this limitation by setting timeframes within which to conduct the interviews so as to save time and reduce costs.
1.10 Chapter Summary
This chapter discussed the purpose and research plan of the study. The discussion was divided into the following sub-headings: Study background, statement of the problem, study objectives, research questions, significance of the study, scope of the study and the study limitation.