Page 17 - Estimator's Piping Man-Hour Manual 5E

Most organizations consider the cost of field personnel with a rating of superinten­
dent or greater to be a part of job overhead and that of general foreman or lower as
direct job labor cost. The direct man hours on the following pages have been deter­
mined on this basis. Therefore, a composite rate should be used when converting
the man-hours to direct labor dollars.

The estimator must also again consider labor conditions in the area where the pro­
ject is to be located. He must determine how many men he will be allowed to use in
a crew plus how many crews he will need.
Example: This will illustrate how to obtain a composite rate:

We assume that a certain pipe project will need four 10-man crews and that only one
general foreman will be needed to head the four crews.

Rate of pipefitter craft in a given area:
General foreman , $23.75 per hour
Foreman $23.50 per hour
Journeyman $23.00 per hour
Fifth-year apprentice $18.00 per hour

NOTE: General foreman and foreman are dead weight because they do not work with
their tools; however, they must be considered and charged to the composite crew.

Crew for composite rate:
One general foreman 2 hours @ $23.75 = $ 47.50
One foreman 8 hours @ $23.50 - 188.00
Nine journeymen 8 hours @ $23.00 = 1,656.00
Fifth-year apprentice 8 hours @ $18.00 = 144.00
Total, for 80 hours $2,035.50
$2,035.50 -T- 80 = $25.44 composite man-hour rate for 100% time.

Note that the man hours are based on an average productivity of 70%. Therefore, the
composite rate of $25.44 as figured becomes equal to 70%.

Let us assume that you have evaluated your job and find it to be of a low average with
a productivity rating of only 65%. This means a loss of 5% of time paid per man hours.
Therefore, your composite rate should have an adjustment of 5% as follows:

$25.44 x 105% = $26.71 composite rate of 65% productivity

Simply by multiplying the number of man hours estimated by the calculated compos­
ite rate, you can arrive at a total estimated direct labor cost, in dollar value, for pipe
fabrication and installation.

The foregoing explanation should enable the ordinary piping estimator to turn out a
better labor estimate and will eliminate much guesswork.