Bud­get­ing for trades

E Build It Es­ti­mat­ing Ser­vice’s Adrian Wild shares the typ­i­cal hourly pay rates trades­peo­ple ap­ply to their quotes

Build It - - EDITOR’S LETTER -

Adrian Wild shares his knowl­edge on what you should bud­get for labour rates on your build­ing project

As a rough guide, around a third of the bud­get for any self build or ren­o­va­tion project goes into labour costs. So, in the­ory, you could save a con­sid­er­able sum of money if you take on the work your­self. In prac­tice, of course, few of us have the ex­pe­ri­ence or time to take a DIY ap­proach. So we need to pay peo­ple who do have the right skills to com­plete the works for us.

Project routes & costs

There are sev­eral ways to suc­cess­fully run a construction scheme (and man­age the labour). Hir­ing a gen­eral builder to run the scheme is a pop­u­lar op­tion, for in­stance. This route is likely to be more ex­pen­sive than han­dling things your­self. That’s partly be­cause you’ll be pass­ing much of the risk – ie the re­spon­si­bil­ity for sort­ing out any­thing that goes wrong – over to them. It will also be their job to find the in­di­vid­ual trades for you, sched­ule their time on site and mon­i­tor their work.

If you choose to project man­age and hire trades your­self, you can ex­pect a lower labour bill – eas­ily 10% less than the gen­eral builder route. But this will be at the ex­pense of your in­creased com­mit­ment in terms of time and re­spon­si­bil­ity. It will be down to you to source quotes, de­cide whether you’re happy with the day rate your trades are charg­ing, sched­ule works and ma­te­ri­als de­liv­er­ies, as­sess qual­ity of work­man­ship and to ab­sorb ex­tra costs if and when any­thing goes wrong.

Mar­ket forces & labour short­ages

A big headache for con­trac­tors and project man­agers at the mo­ment is find­ing trades­peo­ple who are avail­able and re­ally skilled in their field. I hear from a lot of build­ing firms strug­gling to find good brick­lay­ers, car­pen­ters and join­ers in par­tic­u­lar. Un­sur­pris­ingly, the most ex­pe­ri­enced, highly rep­utable trades are able to charge top dol­lar for their work. The shortage in key trades has led to a rise in the use of agen­cies for labour. They have a large data­base of con­trac­tors on their books, so they can guar­an­tee some­one will be on site when they say they will. You’ll pay over the odds – at least £30 more per hour – but at least you won’t face the added costs that de­lays bring.

Ear­lier this year, The Sun­day Times re­ported on re­search by www.to­taljobs.com that the aver­age salary for a brick­layer was £36,679 – but that in parts of the coun­try where de­mand is high, this can rise to more than £60,000. If the gen­eral mar­ket cools in 2019 and good trades be­come eas­ier to find, this could trans­late into keener labour rates for self builders. But there are many fac­tors at play: cost con­sul­tant Turner & Townsend’s mar­ket­ing anal­y­sis sug­gest the po­ten­tial ex­o­dus of EU mi­grant works post-brexit could see labour costs in­crease by 4% over the next year, for in­stance.

Get­ting the right quotes

Whether you’re us­ing a gen­eral builder or in­di­vid­ual trades, it’s im­por­tant to give a full brief. If you don’t pro­vide enough info – in­clud­ing plans, draw­ings, spec doc­u­ments, and de­tails of the qual­ity of ma­te­ri­als and fin­ish you want – some will over­spec­ify to avoid the risk of their mar­gin tak­ing a hit. At the other end of the scale, if you give scant de­tails then you can ex­pect ex­tra costs down the line – or trades may go for a cheap spec and make their money by charg­ing you over the odds on ma­te­ri­als.

What am I pay­ing for?

Self-em­ployed trades must ac­count for a range of ad­di­tions over and above their time (and pos­si­bly that of a labourer, too), skill and the ma­te­ri­als they’ll be buy­ing in. Their prices need to cover the cost of their ve­hi­cle, travel, tools and equip­ment, plant hire, na­tional in­sur­ance con­tri­bu­tions and busi­ness in­sur­ance (eg for tools, per­sonal ac­ci­dent and pub­lic li­a­bil­ity).

On top of that is cer­ti­fi­ca­tion, on­go­ing train­ing, mem­ber­ship of trade as­so­ci­a­tions, and pos­si­bly Construction In­dus­try Scheme reg­is­tra­tion (to re­duce up­front tax pay­ments). They may also al­low for pen­sion con­tri­bu­tions and paid leave.

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