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Federal Reserve Bank of St. Louis
Labor Requirements for Hospital Construction. Bulletin No. 1340

Errata Sheet

(1) Page 15, second paragraph, last sentence, should read:

"However, a very rough adjustment for price change indicates

that on-site man-hours per $1,000 (in constant prices) for hospital construction have declined by approximately one-third in the past 20 years.*1

(2) Page 15, fourth paragraph, first sentence, should read:

"It is interesting to note that the decrease over the 20 years

in site man-hours appears to be about the same as that for schools and

about twice as large as that for Federal buildings.M

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Preface

This study of labor requirements for the construction of general hospitals is the fourth in a series of such studies authorized by the 86th Congress

for various types of construction that might be affected by Government action.

Previous studies were made for schools, highways, and Federal office buildings.

Surveys currently in preparation cover the civil works activities of the Corps

of Engineers, such as the construction of dams and levees and dredging of

channels, and several segments of the housing industry (private single-family

dwellings, public housing, and housing for college students). Other surveys

are in the planning stages.

The studies are being made by the Bureau of Labor Statistics, Division of

Productivity and Technological Developments, under the supervision of James F.

Walker. This report was prepared by Herman J. Rothberg, who also directed the

collection of statistical data. Ronald E. Kutscher was in charge of the group

determining the employment created by the use of building materials.

The Bureau is grateful to the Public Health Service of the U.S. Department

of Health, Education, and Welfare and the Departments of Health of the various

States for their generous cooperation and for making available the data which

were tabulated to determine the direct labor requirements for federally aided

hospital projects. The Bureau also appreciates the cooperation of the construction contractors who supplied the materials data on which the estimates

for indirect requirements were based, as well as the on-site man-hour data for

nonfederally aided projects.

i

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CONTENTS

Page

Introduction.............................................. 1

Nature of survey ........................................ ....... 2

General survey findings and characteristics ........................... 4

Building characteristics .............................................. 6

On-site man-hour r e q u i r e m e n t s.............. 11

Regional group comparisons.................. 13

Labor requirements in earlier periods ..................... ..... 15

Requirements by occupation ....................... .......... 16

General and special trade contractors* shares . ..................... 18

The cost of direct w a g e s ...................................... 21

Off-site e m p l o y m e n t .............. 2A

Builders* off-site employment ...................................... .. 25

Employment in transportation, trade, and service ................. .. 26

"Last manufacturing stage" employment ................................ 26

Bnployment in secondary activities ...... ......................... 26

Construction time ..... ................. . . . . . . . . . . . . . 27

Employment by construction periods .................................... 27

Materials u s e d ................................. 30

Changes in m a t e r i a l s.......... 36

Requirement comparisons with school, public building, and highway

construction .............................................................. 38

Appendix A. Scope and method of s u r v e y ......................... .. 41

Characteristics of the universe and selection of the s a m p l e ........ 41

Collection of on-site man-hour d a t a ........................... .. 43

Off-site m a n - h o u r s............ 44

Primary distribution industries employment . ............... ..... 44

Primary manufacturing employment ......................... 44

Secondary employment in all industries............................... 45

Total man-hour r e q u i r e m e n t s............ 45

Tables:

1. Number and cost of 46 hospital construction projects, by

selected characteristics and region, 1959-60 .... ............ 8

2. On-site man-hour requirements for hospital construction projects,

by selected characteristics and region, 1959-60 ............... 12

3. On-site man-hour requirements per $1,000 of hospital construction

contract, by proportion of lower skilled labor employed and

region, 1959-60 14

4. Distribution of hospital construction projects, by number of onsite man-hours required for each $1,000 of construction

contract, by region, 1959-60 .................................. 14

5. On-site man-hour requirements per $1,000 of hospital construction

contract, by occupation and region, 1959-60 ........ . . . . . 17

iii

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CONTENTS— Continued

Page

Tables— Continued

6. Apprentices as percent of on-site employment on hospital construction projects, by occupation and region, 1959-60 ..... 19

7. Percent of total on-site man-hour requirements for hospital construction, by type of contractor and region, 1959-60 ........ 20

8. Average number of contractors per hospital construction project,

by cost group and region, 1959-60 .............................. 20

9. Average on-site hourly earnings on hospital construction projects, by selected characteristics and region, 1959-60 .... 22

10. Average number of weeks required for construction of hospitals,

by cost group and region, 1959-60 .............................. 28

11. Total cost of material components for each $1,000 of hospital

construction contract, 1959-60 ........... • ................. 31

Charts:

1. Distribution of man-hours for each $1,000 of hospital construction contract, 1959-60 . . ...................................... 5

2. Percent distribution of on-site wages and materials used for each

$1,000 of hospital construction contract, 1959-60 ............. 7

3. On-site man-hours of construction labor for each $1,000 of hospital construction contract, by decile of construction time . . 29

iv

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LABOR REQUIREMENTS FOR HOSPITAL CONSTRUCTION

Introduction

New construction is a major component of the Nation’s output of goods and

services and an important source of employment. It creates jobs not only at

project sites but also in the many manufacturing, trade, and transportation

industries which furnish materials required in the construction process.

Because of their far-reaching employment impact, construction projects are

often regarded as a means of counteracting cyclical unemployment.

To measure the labor requirements for various types of construction, the

Bureau of Labor Statistics has undertaken a series of studies. Hospital

construction— public and private, profit and nonprof it— was selected for early

study because it represents a relatively substantial part of all nonresidential

building construction expenditures and because of the widespread expression

of need for additional hospital facilities of all types. Expenditures for the

construction of hospital and related medical facilities (including Federal

facilities and those federally assisted) were at an annual rate of $1.16

billion in 1961 and accounted for about 7.5 percent of the total nonresidential

building construction that year. Federal funds accounted for $220 million or

almost one-fifth of all hospital construction expenditures, with $165 million

of this sum devoted to assisting various State and local public and private

nonprofit groups to meet demonstrated need for hospital and related facilities

under the Hill-Burton program. (See appendix A.) This programsinitiated in

1946, was influential in helping to bring hospital facilities to areas that

never before had hospitals, or in some cases, had inadequate facilities. The

extent to which the program aided in generating the construction of hospital

facilities is indicated by the fact that from its inception through December 31,

1961, $4.67 billion in total costs were approved under the program; and for

every $1.45 of the Federal share, $3.22 was spent by the assisted States or

local public and private nonprofit groups.

It is estimated that almost $4 billion will be spent in the 3-year period

1962 through 1964 for the construction of hospital and related medical facilities. 1I A few thousand projects will probably be involved. The Public

Health Service anticipates that to meet future needs for hospital facilities,

increasingly higher expenditures of Federal, State, and local public funds as

well as private moneys, will be required for hospital construction through the

latter sixties and early seventies. Etnphasis is expected on construction

devoted to expansion and renovation of "big city" hospitals, chronic disease

hospitals, and skilled nursing homes. Although general hospitals 2/f both

1/ Unpublished preliminary estimates of the Division of Hospital and

Medical Facilities, Public Health Service, U.S. Department of Health,

Education, and Welfare.

2/ For definition of "general hospitals," as used in this study, see

appendix A.

1

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new and additions to existing ones, are the subject of this study, the findings

may be useful in estimating man-hour requirements for the other types of hospital projects indicated. Equipment and facilities of general hospitals encompass the needs of all types of hospitals and related facilities.

Nature of Survey

This report is based on a survey of selected public and private pnpfit

and nonprofit general hospitals constructed in various localities of the

United States. Data were collected for 46 projects, chosen as a representative

sample of hospitals on which construction was begun sometime between mid-1958

and mid-1959. Construction of both new general hospitals and additions,

whether separate buildings or extensions to existing ones, were studied. 3/

Although the survey did not cover moveable, unattached furnishings and

equipment used in the hospitals studied, it did include built-in equipment

unique to a hospital, such as X-ray dark room equipment, sterilizing equipment,

pharmacy and laboratory equipment, cabinets at nurses stations, and other

items, such as elevators and communications systems, which are permanently

fixed in place so as to constitute integral parts of the buildings.

The survey was designed primarily to determine the number of man-hours

represented by a fixed dollar volume ($1,000) of general hospital construction.

Man-hours, as defined by the survey, include both on-site construction employment and the off-site employment required to produce and deliver materials

used in the construction. Data for on-site labor include total man-hours for

the supervisory, engineering, clerical, and custodial employees at the site,

as well as those for workers in each construction trade. For almost fourfifths of the projects, additional data were obtained on wages and timing of

employment. Data for off-site labor include employment in the off-site

(e.g., office and warehousing) activities of construction contractors; in

building materials and equipment manufacture and distribution; and finally,

employment in all the other industries which are affected directly or indirectly by the production and distribution of building materials from raw

material to the final manufacturing stage.

Certain types of employment, however, are not covered by the survey.

Excluded are preparation of plans and specifications of the projects; production of movable furniture and administrative office equipment; the labor time

involved in installations by public utility employees, as well as any site

preparation, landscaping, and highway work not covered by the construction

contract. No estimate was made of the labor generated by the money expended

for contractors* overhead, other than off-site administrative salaries. The

major part of such overhead consists of salaries and profit. It is believed

3/ For a more detailed description of method and for a list of States

included in each region, see appendix A.

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that the other overhead items such as rent, bonds, insurance, taxes (including

payroll taxes), welfare payments, and office supplies, generate relatively

little employment. Employment created by the respending of wages and profits

of the workers and their employers--the multiplier effect— was not considered

within the scope of the study.

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General Survey Findings and Characteristics

For every $1,000 of construction contract concerned in the building of

general hospital structures in 1959-60, 223 man-hours of employment were created, Of these, 89 were for employment at the construction site and 134 were

required for various off-site activities. (See chart 1.) The latter included

all labor needed to produce and deliver materials and equipment used by the

on-site workers, plus employment by the construction contractors in administrative, warehousing, and certain other off-site operations. Total man-hours

were all ated as follows:

£.<01 c -1. i 0 1 1 — u Q U f. •

Construction:

O n - s i t e........................ .............

Off-site ................................... .

Manufacturing..................................

Transportation ........ ............. ............

Trade and s e r v i c e........ .....................

Other industry employment ....•.••«•............

Man-hours per

$1,000 of contract

Number Percent

223 100

89 40

11 5

79 35

9 4

22 10

13 6

As pointed out in later sections of this report, new hospitals and additions to existing hospitals (with their related alterations) form two relatively homogeneous subgroups to make up the general hospital construction

category and are therefore occasionally nalyzed separately. Thus, on-site

construction man-hours for additions amounted to 94 per $1,000 of construction

contract amount or 9 percent more than 86 man-hours required for the new hospitals. This appeared to be due mainly to alteration and repair work as part

of the additions. Detailed compilations of the off-site man-hours for both

of these subgroups were not made. However, while average cost of materials

(including rental or depreciated cost of construction equipment) for all the

projects was $544 per $1,000 of contract amount, the average was $513 for

additions and $557 for new hospitals. Since off-site hours (except those in

the construction industry) are developed from cost data on the value of materials used at the site, it would indicate that the increased on-site hours

for additions were virtually balanced by the lower off-site hours as represented by lesser materials cost per $1,000 of contract, so that total requirements for both of the subgroups are almost identical. (Lower materials cost

per $1,000 of contract value for additions appears to result mainly from the

fact that on-site hours including those used for alteration and repair work

consume a larger part of each $1,000 of contract amount than do the hours for

new hospitals.)

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Chart 1. Distribution of Man-Hours for Each $1,000 of

Hospital Construction Contract, 1959-60

Off-site

Construction

SECONDARY

MAN-HOURS

Other

Manufacturing

Last Manufacturing

Stage

13

Transportation,

Trade and

Services

All Othe

Industrie

On-site

Construction

Transportation

and Trade

>

PRIMARY

MAN-HOURS

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The average cost of the hospitals studied was about $1.5 million (exclusive of site and planning cost) and it was the same for new projects and for

additions. Average hospital construction time was approximately a year and a

half. Therefore, the hospital projects provided on the average the equivalent

of continuous work for 49 workers for 18 months at the construction site. A

somewhat greater amount of employment was provided in off-site activities. 4/

During recent years, an average of about $1 billion a year has been spent

for the construction of all hospital and related medical facilities. This

would indicate that such construction has been the source of about 117,000

jobs annually--67,000 of these off-site. Meeting the anticipated needs previously noted, however, suggests the creation of an even higher level of

employment.

The survey disclosed wide ranges of man-hour and materials requirements

among individual projects, reflecting differences in size of building, geographical location, and local practices. There were also marked variations

in such related measures as average hourly earnings and site wages as

percentages of construction cost. On the average, however, 54 cents of the

construction dollar was spent for materials purchases, and 29 cents for wages

to on-site workers (earnings averaged $3.18 per hour). (See chart 2.)

Building Characteristics

The size and cost of the 46 hospital projects surveyed averaged as

follows:

Average

Floor space ..............

Cost per square foot ....

Number of beds ..........

Cost per bed .............

Hospital construction cost

56.5 thousand square feet

$25.93

86

$16,947

$1,463,723

The size and cost of individual hospitals, of course, varied considerably

and reflected differences in design and type of construction, and metropolitan

versus nonmetropolitan needs. (See table 1.) For example, included in the

sample is a small, one-story, 18-bed wood frame, brick-veneered building,

costing less than $100,000. It has a multi-purpose delivery-operating room,

a small laboratory, including a small X-ray unit, and a waiting room. Its

very low cost per square foot was $6.50, and per bed, $2,887.

4/ The annual employment estimate of construction workers is based on

50 times the 1959 average employment in contract construction work of 35.7

hours a week as reported in the Bureau's Earnings and Hours series. For other 

types of employment, 2,000 hours were considered a year's employment.

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Chart 2. Percent Distribution of On-Site Wages

and Materials Used for Each $1,000 of Hospital

Construction Contract, 1959-60

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Table 1. Number and Cost of 46 Hospital Construction Projects, by Selected Characteristics and Region, 1959-60 1 /

United States Northeast North Central South West

Cost per— Cost ;per— Cost per— Cost per— Cost per—

Characteristic

Number Square

foot

Bed

(thousands)

Number Square

foot

Bed

(thousands)

Number Square

foot

Bed

(thousands)

Number Square

foot

Bed

(thousands)

Number Square

foot

Bed

(thousands)

All hospitals .......... 4.6 $25.93 $16.9 6 $23.90 $ n . A 16 $27.44 $19.1 16 $23.66 $16.8 8 $29.63 $19.9

N e w ........................ 32 25.4-9 17.5 3 24.13 16.1 11 25.89 15.7 13 23.53 17.7 5 30.49 20.8

Additions .................. 14 27.00 15.7 3 23.73 9.4 5 30.17 28.2 3 24.64 12.4 3 27.70 18.1

In a metropolitan area .... 20 26.39 17.2 4. 23.39 9.4 6 30.01 20.2 5 22.48 17.3 5 30.32 21.1

Not in a metropolitan area . 26 24.91 16.4 2 24.73 17.1 10 23.37 17.1 11 26.19 16.0 3 25.79 14.6

Construction cost group:

Under $500,000 .......... 17 22.23 12.4 1 (2/) (2/) 6 20.53 12.3 7 22.17 12.9 3 27.93 12.5

$500,000-3999,999 ....... 9 23.05 14.5 1 (2/) (2/) 4 23.57 16.6 4 23.44 12.0 — — —

$1,000,000-11,999,999 .... 10 24.14 17.7 2 21.69 15.9 3 24.77 22.0 2 24.05 13.1 3 25.70 21.6

$2,000,000 and over ..... 10 27.74 18.1 2 26.60 9.5 3 31.64 21.0 3 23.88 20.2 2 31.84 20.8

Type of structural framing:

14 28.47 15.3 3 25.57 10.1 4 27.54 15.3 4 30.22 17.4 3 30.85 21.5

Reinforced concrete ..... 17 25.08 19.7 2 21.69 15.9 6 29.12 26.9 5 22.93 18.3 4 28.10 18.0

Load-bearing masonry .... 13 22.37 13.2 1 (2/) (2/) 6 23.36 15.1 6 21.74 11.9 — — —

Wood .................... . 2 24.37 11.0 — — — — — 1 (2/) (2/) 1 (2/) (2/)

1 s t o r y ......... .......... 24 23.25 14.6 1 (2/) (2/) 9 23.53 16.8 11 22.75 12.5 3 24.95 17.8

2-4. stories ................ 11 26.07 20.0 3 21.39 16.2 5 28.15 26.6 1 (2/) (2/) 2 29.64 15.3

5 or more stories ......... 11 26.75 16.8 2 26.60 9.5 2 29.72 16.3 4 23.82 18.7 3 30.57 21.7

Elevators .................. 29 26.30 17.5 5 24.13 11.5 12 27.78 19.6 6 23.83 18.2 6 30.15 19.8

No elevators ............... 17 23.26 13.6 1 (2/) (2/) 4 23.74 14.1 10 22.94 12.5 2 25.18 21.2

Air-conditioned:

Full ..................... 28 25.58 18.2 1 (2/) (2/) 10 28.75 20.2 15 23.67 16.9 2 27.14 18.7

Partial .................. 13 27.29 15.0 5 24.32 10.8 4 23.63 16.6 — — — 4 31.34 20.2

Not air-conditioned ..... 5 22.30 15.2 — — — 2 16.24 8.6 1 (2/) (2/) 2 24.76 20.2

Full or partial basement ... 28 26.23 17.3 4 23.48 9.3 12 27.85 19.4 7 23.75 17.6 5 30.22 21.1

No basement ................ 18 24.85 15.8 2 24.51 16.2 4 25.00 17.0 9 23.33 14.3 3 27.73 16.7

Exterior:

M a s o n r y..... ............ 39 25.01 17.0 6 23.90 11.4 14 27.27 22.3 14 23.75 17.3 5 26.74 17.8

Curtain wall ............. 5 29.46 16.7 — — — 2 27.88 14.0 2 21.97 10.3 1 (2/) (2/)

Other .................... 2 29.06 18.3 — — — — — — — — — 2 29.06 18.3

1/ Although construction of projects studied extended over a ^ -year period, most of the construction took place in 1959-60.

2/ Insufficient coverage to warrant presentation.

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Also Included in the projects studied is a new, multistoried, "big city"

hospital of reinforced concrete frame and masonry exterior, costing about

$5 million. It is air conditioned throughout, has five elevators and more than

300 beds. It is supplied with operating rooms, delivery rooms, diagnostic and

deep-therapy rooms, X-ray rooms, completely equipped laboratories, a large

emergency department, and ample provisions for outpatients and physical therapy. The most modern signaling and call systems for doctors, nurses, and

patients have been installed. Written communications and small packets are

transmitted between hospital areas through a pneumatic airtube system, thereby

reducing handling costs of paperwork, records, supplies, and medications.

Kitchen and laundry facilities are in keeping with the overall demands of the

hospital. There are separate nurses quarters and an individual heating plant.

For this hospital, cost per square foot was $32.30 and $16,190 per bed.

Hospitals constructed in metropolitan areas— about 43 percent of the projects studied— were generally larger and more expensive in terms of total cost,

cost per square foot, and cost per bed, than those built in nonmetropolitan

areas. Contributing to the higher total and unit costs of large urban area

hospitals is the vastly increased amount of built-in equipment unique to a

hospital such as that described above. This equipment and the structural

features necessary to accommodate it are included in the construction contract

cost of the projects studied.

Additions were constructed at an average cost of $27 per square foot

compared with $25.49 for new hospitals. This slightly higher cost appears to

be attributable mainly to the added labor required to make the necessary

alterations and repairs which were a part of almost all the construction contracts for additions.

Despite variations in size and location of the sample projects, there was

considerable uniformity in most hospital construction features, except for

structural framing. Reinforced concrete was used for framing on 37 percent of

the projects, steel on 30 percent. Both types were employed in all regions

and for buildings of all heights. Load-bearing masonry was used for 28 percent

of the projects. Of these, all were one-story buildings except one which had

two stories. The remaining projects were framed in wood.

Concerning the more uniform construction features, masonry was the principal exterior wall material in 85 percent of the hospitals, and formed some

part of the outer walls in most of the other projects. Extensive use was made

also of exterior trim in the form of metal (aluminum and steel), glass,and

tile. Roof decks were usually of concrete (poured, mainly, with a few precast),

although some gypsum and steel were used. They were invariably covered with a

built-up composition surface. All floors were of concrete; most were poured,

some were precast. Asphalt and vinyl tile were by far the commonest floor

covering. However, terrazzo and ceramic tile were used extensively for operating, laboratory, kitchen, and lavatory areas. In the operating room suites,

specially mixed cement containing some carbon black v;; s used in conjunction

with the terrazzo to provide conductive flooring. This has the effect of

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making all equipment and personnel in the area nonconductive by drawing-off

or "bleeding" static electricity. Most permanent interior walls were of

plaster. Ceilings were either of plaster or acoustical tile. Lead-lined

doors, walls and ceilings were commonly used in X-ray equipment areas as a

radiation shield. Most buildings had preglazed aluminum window sashes and

frames. Air conditioning, central or unit, was installed in almost all the

hospitals. Elevators were provided for all buildings with more than one story

above grade. All the new hospitals had fully equipped kitchens and laundries.

This construction was accomplished within the 3%-year period from the

summer of 1958 to the fall of 1961. Most of the construction, however, took

place during 1959-60.

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On-Site Man-Hour Requirements

Average man-hours at the construction site, obtained by dividing total

man-hours by total construction contract cost, numbered 88.8 per $1,000 of

construction contract, for all the hospital projects.

About 54 percent of the individual projects ranged from 80 to 100

man-hours. However, the overall range was much wider, reflecting special

circumstances associated with the projects which tended to increase or decrease

unit labor requirements. Apart from the variation in labor requirements exhibited by a ranking of individual projects, the survey also disclosed the existence of marked differences in group averages when the data were analyzed by

various criteria such as size, location, characteristics of construction, and

by whether the projects represented construction of new hospitals or of additions. (See table 2.) For some of these criteria, group averages revealed

that man-hour requirements per dollar paralleled requirements per square foot;

in others, the measures took divergent paths. Differences in design, materials, and relative costs affect the comparisons, particularly between regions.

Construction of new hospitals generally required fewer man-hours per

$1,000 than additions. The higher man-hour requirements for additions

appeared to be due to some alteration work on preexisting structures as a

part of the construction contract of most additions. This work, consisting

largely of tearing down or breaking through wall, floor, and ceiling areas,

required added labor of both skilled (carpenters, plumbers, electricians) and

unskilled workers— to raze in order to rebuild. Thus, compared with new hospitals, the ratio of labor to materials costs would necessarily be higher.

The extent of such work varied with the degree of accommodation necessary to

merge the old and the new structures.

In some situations, the additions were used mainly to provide added bed

space and nurses stations, with the changes involving only minor tearing out

and rebuilding of wall areas and tying together the necessary supporting

facilities (e.g., plumbing, heating, and electrical) in order to link the

addition to an existing structure. In other cases, particularly among larger

hospitals in metropolitan areas, the hospital authorities used the additions

to house newer, more modern and efficient medical, surgical, and administrative

equipment. In such instances, more extensive changes were sometimes required

in the older structures to fit them into the new arrangement in which the

addition became the core of the hospitals' patient servicing functions.

Analysis of the man-hour requirements for all the projects by size and

location further emphasized the effect of the higher man-hour requirements per

$1,000 for additions. When considered by cost class, as construction contract

cost of the projects rose, man-hours per $1,000 remained relatively constant.

Projects in metropolitan areas were found to use slightly more man-hours than

those in nonmetropolitan areas. However, when new hospitals only were considered, (less two atypical hospital projects in the South), there emerged a

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Table 2. On-Site Man-Hour Requirements for Hospital Construction Projects, by Selected Characteristics and Region, 1959-60 1/

United States Northeast North Central South West

Characteristic

Man-hours per— Man-hours per— Man-]hours per— Man-hours per— Man-hours per—

$1,000

of

cost

1,000

square

feet

Bed

$1,000

of

cost

1,000

square

feet

Bed

$1,000

of

cost

1,000

square

feet

Bed

$1,000

of

cost

1,000

square

feet

Bed

$1,000

of

cost

1,000

square

feet

Bed

All hospitals ........... 88. S 2.301 1.504 91.4 2.185 1.040 85.7 2,353 1.634 95.3 2,254 1,602 81.1 2,404 1,615

N e w ................. ....... 86.4 2,202 1,516 86.1 2,076 1,383 76.9 1,991 1,204 96.1 2,262 1,704 78.6 2,396 1,631

Additions .................. 94.3 2,546 1,481 95.4 2,263 893 98.9 2,985 2,791 89.1 2,196 1,102 87.5 2,423 1,580

In a metropolitan area .... 89.5 2,362 1,540 94.4 2,208 883 87.3 2,621 1,764 95.6 2,149 1,654 82.6 2,505 1,740

Not in a metropolitan area . 87.1 2,169 1,426 86.8 2,146 1,487 82.5 1,928 1,409 94.7 2,480 1,513 71.4 1,841 1,046

Construction cost group:

Under $500,000 ........... 88.6 1,969 1,098 (2/) (2/) (2/) 91.0 1,869 1,122 92.5 2,050 1,194 78.3 2,188 978

$500,000-1999,999 ....... 87.6 2,019 1,272 (2/) (2/) (2/) 79.7 1,879 1,326 91.2 2,138 1,092 — — —

$1,000,000-$l,999,999 90.2 2,178 1,597 87.4 1,896 1,391 82.6 2,045 1,820 104.9 2,524 1,378 87.4 2,247 1,885

$2,000,000 and over ..... 88.5 2,455 1,602 92.3 2,454 873 87.1 2,757 1,829 94.3 2,253 1,901 78.9 2,513 1,640

Type of structural framing:

Steel ..................... 80.6 2,295 1,232 94.1 2,407 947 74.0 2,039 1,130 84.8 2,564 1,473 75.6 2,331 1,622

Reinforced concrete ..... 95.8 2,403 1,888 87.4 1,896 1,391 95.4 2,778 2,564 99.8 2,288 1,823 89.7 2,521 1,611

Load-bearing masonry .... 84.4 1,889 1,113 (2/) (2/) (2/) 85.2 1,990 1,289 84.3 1,833 1,005 — — —

Wood ..................... 74.4 1,391 816 — — —

— — (2/) (2/) (2/) (2/) (2/) (2/0

1 story .................... 83.8 1,950 1,221 (2/) (2/) (2/) 82.2 1,935 1,383 91.9 2,090 1,144 67.5 1,683 1,200

2-4 s t o r i e s.... ........... 95.4 2,486 1,909 91.4 1,955 1,480 91.9 2,588 2,443 (2/) (2/) (2/) 92.5 2,741 1,415

5 or more stories ......... 87.9 2,351 1,479 92.3 2,454 873 82.3 2,447 1,338 93.5 2,228 1,746 81.0 2,476 1,757

Elevators .................. 89.1 2,344 1,557 91.9 2,217 1,054 85.7 2,379 1,678 95.8 2,282 1,746 82.9 2,501 1,641

No elevators ............... 85.8 1,995 1,169 (2/) (2/) (2/) 86.7 2,057 1,221 93.1 2,134 1,164 62.7 1,579 1,331

Air-conditioned:

Full ..................... 90.6 2,316 1,646 (2/) (2/) (2/) 85.3 2,453 1,726 95.6 2,263 1,613 82.8 2,247 1,550

Partial .................. 84.0 2,293 1,260 92.0 2,238 990 82.4 1,947 1,367

(2/)

— — 78.7 2,466 1,590

Not air conditioned ..... 95.9 2,140 1,461 —

— — 117.6 1,909 1,016 (2/) (2/) 94.4 2,338 1,910

Full or partial basement ... 88.0 2,310 1,523 95.1 2,234 886 86.1 2,398 1,671 92.5 2,197 1,626 80.7 2,438 1,699

No basement ................ 91.5 2,273 1,442 86.3 2,117 1,399 83.3 2,083 1,417 106.4 2,482 1,520 82.8 2,294 1,383

Exterior:

Masonry .................. 92.0 2,300 1,560 91.4 2,185 1,040 90.9 2,480 2,032 95.3 2,263 1,652 82.4 2,203 1,465

Curtain wall ............. 76.6 2,258 1,282 — — — 72.8 2,030 1,016 94.3 2,071 969 (2/) (2/) (2/)

Other .................... 91.1 2,647 1,664 — — — — -- — — — —— 91.1 2,647 1,664

1/ Although construction of projects studied extended over a 32-year period, most of the construction took place in 1959-60.

2/ Insufficient coverage to warrant presentation.

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pattern of lower man-hour requirements for the larger projects and for those

in metropolitan areas where, obviously, larger hospitals predominate. By

size of hospital, the following appeared:

Construction contract cost Man-hours per $1,000

Under $500,000 .............................. 86.1

$500,000 to $999,999 ........................ 83.5

$1,000,000 to $1,999,999 .................... 83.0

$2,000,000 and over ............... 76.5

By location, the new metropolitan area hospitals required 77.0 man-hours and

the noranetropolitan, 83.1. Contributing to the lower man-hour requirements

per $1,000 of the costlier, larger projects was the fact that such projects

afforded maximum utilization of laborsaving equipment, such as cranes, elevators, and conveyors, and more efficient organization. These same advantages

were available to contractors for the larger addition projects which also

would probably have reflected the same pattern of lower man-hour requirements

as project cost rose but for the additional "tearing down" hours involved in

necessary changes.

Generally, for most projects, lower man-hour requirements were associated

with greater than average use of skilled craftsmen. Higher proportions of

laborers and helpers were usually related to higher man-hour requirements per

$1,000 of contract (table 3).

Regional Group Comparisons

Man-hour requirements on the site of construction varied by region.

(See table A.) The factors previously discussed, affecting the man-hours,

were also responsible, to a considerable degree, for the regional variations.

Half of the projects in the Northeast were additions and, except for one small

new hospital, they accounted for all the metropolitan area hospital construction in the region. This is reflected in the more-than-average man-hour

requirements for the region and the substantially higher man-hours for metropolitan hospitals compared with those in nonmetropolitan areas. When only new

hospitals are considered, man-hours are below the average for every region

except the South. In that region, the higher requirements reflect a more

frequent use of laborers and helpers. Moreover, the two atypical projects

previously noted were in the upper range of man-hour requirements and substantially influenced the total man-hour requirements for the region. One of these

two projects was a large nonmetropolitan hospital on which the workers received

the second lowest average hourly earnings and total man-hours were the highest

of all the projects studied. The other project, in an urban area, contained

many expensive, custom-built features.

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Table 3. On-Site Man-Hour Requirements per $1,000 of Hospital Construction

Contract, by Proportion of Lower Skilled Labor Employed 1/ and Region,

1959-60 2/

Percent lower skilled

workers of total

Man-hours per :£1,000 of contract

United

States

Northeast North

Central

South West

All workers .............. 88.8 91.4 85.7 _ 95.3 81.1

25.0 and under.......... . 80.6 92.5 76.2 77.5 81.4

25.1-35.0 ................... 95.8 90.3 96.5 98.0 76.3

35.1 and o v e r............... 111.2 ' 111.2

1/ For purposes of this comparison, laborers, helpers, and tenders were

considered lower skilled.

2/ Although construction of projects studied extended over a 32-year

period, most of the construction took place in 1959-60.

Table 4. Distribution of Hospital Construction Projects, by Number of

On-Site Man-Hours Required for Each $1,000 of Construction Contract,

by Region, 1959-60 l/

Percent of man-hours required United

States

Northeast North

Central

South West

Average man-hours for all

projects ................... 88.8 91.4 85.7 95.3 81.1

Man-hour ranee Percent of projects

Under 70.0 ................... 4.3 25.0

70.0-79.9 .................... 19.6 16.7 25.0 18.8 12.5

80.0-89.9 .................... 39.1 50.0 43.8 31.2 37.5

90.0-99.9 .................... 15.2 16.7 12.5 12.5 25.0

100.0-109.9 .................. 8.7 16.7 6.2 12.5 —

110.0-119.9 .................. 8.7 — 12.5 12.5 —

120.0 and o v e r.......... . 4.4 — “ 12.5 “

1/ Although construction of projects studied extended over a 3-r-year

period, most of the construction took place in 1959-60.

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Labor Requirements in Earlier Periods

It would be of considerable interest to compare labor requirements on

current hospital construction with those on construction in earlier periods.

Unfortunately, however, only a limited amount of information is available and

it cannot readily be used for comparison with current data. The two major

problems are the change in cost (price) of construction and changes in physical specifications.

Changes in costs of materials and of labor, and of the relative proportions of each, affect the total price of construction. Adequate price indexes

are not available for adjusting satisfactorily the dollar values of building

construction costs over periods of time. However, a very rough adjustment for

price change indicates that the total value of materials put in place per manhour (in constant prices) for hospital construction has declined by approximately one-third in the past 20 years. 5/

This decrease reflects several factors. One is the efficiency resulting

from increased mechanization of tools and of materials handling equipment.

Another is the greatly increased amount of built-in modern hospital equipment

(physiotherapy, diagnostic, etc.) owing to advances in medical techniques.

This equipment substantially increases the construction contract dollar total,

yet requires relatively little on-site labor for installation. Still another

factor is the transfer of some operations from site to shop, as in the case

of concrete batching and mixing, and some cabinetry and other carpentry work.

Changes in design are also a factor. However, in some situations, design

changes and other factors may have been responsible for some increase in onsite man-hours, thus nullifying part of the decrease in hours.

It is interesting to note that the decrease over the 20 years in the

total value of materials put in place per man-hour appears to be about the

same as that for schools and about twice as large as that for Federal buildings. 6/ Although too much significance should not be attached to the precise

degree""of difference, because of a lack of comparable data over the period, it

does appear that the decreases in requirements for the three types of construction are in reasonable relation. For some time, rapidly expanding school

population and hospital patient needs have brought extreme pressures on local

communities and private groups to provide additional facilities as rapidly as

possible. Architects, materials suppliers, and contractors have cooperated

in providing construction using a larger amount of subassemblies and prefabricated items. No such extreme pressures on cost and speed have been exerted

5_! Based on unpublished BLS data for public works projects built in the

late 1930’s.

6/ Labor Requirements for School Construction (BLS Bulletin 1299, 1961),

p. 9. Labor Requirements for Federal Office Building Construction (BLS Bulletin

1331, 1962), n. 9.

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on Federal office building construction. Thus, Federal buildings for the most

part continue to use large areas of exterior and interior stonework and present

an appearance of permanence and a somewhat monumental quality which is traditional. Most hospital and school construction, built to accommodate urgent

and immediate need, is without some of these massive building features.

Requirements by Occupation

Distribution of man-hour employment by broad skill areas disclosed that

68 percent of the total on-site man-hours were worked by those in the skilled

trades. Semiskilled and unskilled workers accounted for 28 percent of the

hours, and nonproduction employees (supervisors, engineers, and clerks), 4

percent (table 5).

Within the skilled trades, the workers in three predominant crafts—

plumbers, carpenters, and electricians— accounted for 54 percent of all skilled

man-hours. Plumbers worked 21 percent of the skilled hours and 14 percent of

total on-site hours. Carpenters were next in occupational importance with a

little more than 19 percent of the skilled hours; electricians followed with

13 percent. Although there were variations among projects in the proportion

of hours worked by each of these crafts, as well as the others, there were

relatively few exceptions in the order of skilled craft importance.

The lead position of plumbers reflects the extensive work required in

hospitals to provide for general sanitation and nursing needs, laboratory and

therapy installations, and adequate patient lavatory and toilet facilities.

The proportion of electricians* hours also attests to the broad application

of electrical usages in connection with proper lighting, surgical and medical

equipment, calling and signaling systems, and control systems.

Variations from region to region in ratios of man-hours worked by different trades reflect, for example, differences in regional design and construction

needs, as well as work practices. In the West, for instance, plumbers and

carpenters each worked 17 percent of total on-site man-hours. This equal

sharing of on-site time appears to reflect added carpenter hours owing to

greater-than-average use of wood products in the West. In the Northeast,

where carpenter hours were also about the same as those of plumbers, the higher

proportion of construction cost devoted to additions (including the related

changes to existing buildings) may be responsible for the use of more carpenters. This also appears to account for the fact that a higher proportion of

electricians were employed in the Northeast than elsewhere.

In the matter of work practices, a number of factors affect the regional

distribution by occupation, apart from the construction requirements. For

example, organization of work crews and job classification may be affected

by the relative participation of local unions. Local custom Influences the

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Table 5. On-Site Man-Hour Requirements per $1,000 of Hospital Construction Contract, by Occupation and Region, 1959-60 1/

United States Northeast North Central South West

Occupation Man-hours

worked Percent

Man-hours

worked Percent

Man-hours

worked Percent

Man-hours

worked Percent

Man-hours

worked Percent

All occupations ...... 88. S 100.0 91.4 100.0 85.7 100.0 95.3 100.0 81.1 100.0

General supervisors ..... 2.8 3.1 2.8 3.0 3.0 3.5 3.1 3.2 1.9 2.3

Professional, technical,

and clerical .......... .7 .8 1.3 1.4 .3 .4 1.1 1.2 .3 •4

Plumbers....... 12.7 14.3 12.4 13.5 12.7 14.6 12.0 12.6 14.1 17.4

Carpenters ............. 11.7 13.2 12.7 13.9 9.9 11.6 11.4 12.0 14.0 17.3

Electricians ........... 7.8 8.8 11.1 12.1 7.4 8.7 7.2 7.5 7.5 9.2

Bricklayers ............ 4.8 5.4 5.9 6.4 5.5 6.4 5.8 6.1 1.4 1.8

Sheet-metal workers ..... 4.3 4.8 1.9 2.1 4.6 5.4 3.8 4.0 5.9 7.3

Ironworkers •••••••••••••• 3.1 3.5 3.9 4.3 2.7 3.1 3.1 3.3 3.2 3.9

Ornamental ........... .6 .7 .7 .7 .6 .7 .4 .5 .8 1.0

Reinforcing ........... 1.4 1.6 1.7 1.8 1.1 1.3 1.5 1.6 1.4 1.8

Structural ........... 1.1 1.3 1.6 1.7 1.0 1.2 1.2 1.2 .9 1.1

Plasterers ............. 2.9 3.2 3.4 3.7 2.4 2.7 3.0 3.1 3.1 3.8

Lathers ................ 2.7 3.0 3.3 3.6 2.2 2.5 2.3 2.4 3.7 4.6

Painters ............... 2.5 2.8 2.3 2.5 2.6 3.0 2.5 2.6 2.3 2.9

Asbestos workers...... 1.5 1.7 1.1 1.2 1.7 2.0 1.7 1.7 1.2 1.5

Operating engineers ......

Terrazzo workers and

1.4 1.6 1.4 1.5 1.1 1.3 1.7 1.8 1.2 1.4

tile setters .......... 1.4 1.6 1.1 1.2 1.8 2.1 1.2 1.3 1.3 1.6

Cement finishers..... 1.3 1.5 1.4 1.5 1.0 1.2 1.3 1.3 1.8 2.2

Roofers ................ .6 .7 .6 .6 .5 .6 .7 .7 .5 .7

Elevator mechanics ...... .6 .7 .7 .8 .6 .7 .6 .6 .8 .9

Glaziers ............... .5 .6 .4 .5 .6 .7 .6 .6 .3 .4

Soft floor layers..... .4 .4 .7 .7 .3 .4 .1 .1 .7 .8

Laborers .............. . 17.4 19.6 18.8 20.5 16.6 19.4 21.8 22.9 10.6 13.0

Helpers and tenders ..... 6.3 7.1 3.7 4.1 6.1 7.2 8.6 9.1 4.5 5.6

Truckdrivers ............ .6 .7 .5 .5 .9 1.1 .6 .6 .5 .6

Watchmen............. .. .3 .4 .2 .2 .1 .1 .8 .8 — _

Other ............ ...... .5 .6 .1 .1 1.0 1.1 .4 .4 .4 .4

1959

1/ Although construction of projects studied extended over a 3^-year period, most of the construction took place in

-60.

NOTE: Because of rounding, sums of individual items may not add to totals

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opportunity of union membership and journeyman jobs for minority groups 7/.

Finally, local availability of lower-paid labor may affect the extent to

which laborsaving equipment is employed.

These factors particularly influence the division between skilled and

unskilled workers. In the South, unskilled and semiskilled employees accounted

for 34 percent of total man-hours, compared with 20 percent in the West; the

percentages for skilled trades were 62 and 78 percent, respectively.

The persistence in all regions of a relatively large proportion of manhours by lesser skilled workers is noteworthy, particularly in view of the

complexity of hospital construction. Approximately 28 percent of all on-site

employment was by unskilled and semiskilled employees, despite considerable

mechanization in materials handling, excavating, cleaning, and similar jobs

formerly performed almost exclusively by laborers. This suggests that the

nature of construction operations may limit the degree of mechanization that

can profitably be used.

Apprentices. Apprentices in formal, registered apprenticeship programs

accounted for 3.3 percent of all man-hours worked at the site of the sample

projects, or 8.1 percent of skilled-trade man-hours (table 6). Apprentice

electricians accounted for 18 percent of the total hours worked in their

craft, a greater proportion than in any other trade. For three trades—

asbestos workers, elevator mechanics, operating engineers— which reported no

apprentices, formal programs do not exist or are just evolving. Training is

usually acquired on an informal basis by assisting a journeyman in his work

until the trainee is regarded as fully qualified to perform at the journeyman

level. In some instances, fixed time periods at the Job before becoming eligible for upgrading have been informally established through local work practices. Workers in a learning status, whether called ’’improvers'* in the case

of asbestos work, "helpers” in elevator work, or "oilers" in equipment operation, are grouped with Helpers and tenders in this report. High rates of

apprentice employment are generally associated with shortages of skilled

journeymen in the craft, or with some smaller crafts.

General and Special Trade Contractors* Shares

Employees of the general contractors and three special trade contractors,

Plumbing and heating, Electrical, and Plastering and lathing, accounted for

79 percent of the total man-hours required for the construction of all the

hospital projects. (See table 7.) The general contractors' share, averaging

39.1 percent of all the projects, was highest in the South (42.0). There, a

preponderance of smaller hospital projects resulted in the general contractors'

assumption of some of the special trade duties because the amount of work

requiring certain special trade workers was insufficient to warrant use of a

separate subcontractor.

7/ Employment Outlook in the Building Trades (BLS Bulletin 967, 1949).

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Table 6. Apprentices as Percent of On-Site Employment on Hospital

Construction Projects, by Occupation and Region, 1959-60 1/

Occupation

United

States

NortheastNorth

Central South West

Percent of apprentices

All workers .................. 5.3 4.2 6.0 5.1 5.3

Skilled trades only ............. 8.1 6.1 9.0 8.2 7.4

Bricklayers ..................... 7.4 4*4 8.5 7.9 1.4

Carpenters ...................... 4.2 3.2 6.8 2.6 4.7

Cement finishers ............. . 5.0 12.2 2.7 4.9 .2

Electricians .................... 18.2 12.2 11.2 27.2 20.9

Glaziers........................ 7.8 2.8 2.4 12.0 23.6

Ironworkers ..................... 2.7 .5 4.5 1.9 5.2

Ornamental .................... 4.2 2.7 9.2 — —

Reinforcing ................... 2.1 — .9 2.5 8.6

Structural.................... 2.7 — 5.6 1.8 —

Lathers ......................... 10.6 8.1 7.4 12.4 17.7

Painters........................ 4.9 — 5.4 5.8 6.0

Plasterers ............... ...... 4.6 (2/) 9.4 3.2 2.5

Plumbers ........................ 10.1 9.9 11.9 9.5 5.4

Roofers ......................... 7.4 — 13.0 6.7 3.4

Sheet-metal workers ............ . 11.2 1.2 18.5 6.2 7.5

Soft floor layers ................ 6.0 3.1 10.1 — 3.1

Terrazzo workers and tile setters . 4.2 8.7 3.6 2.7 11.0

1/ Although construction of projects studied extended over a 3^-year

period, most of the construction took place in 1959-60.

2/ Less than 0.05 percent.

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Table 7. Percent of Total On-Site Man-Hour Requirements for Hospital

Construction, by Type of Contractor and Region, 1959-60 1/

Type of contractor 2/

United

States

NortheastNorth

Central South West

All types................... 100.0 100.0 100.0 100.0 100.0

General........... ............ 39.1 35.9 37.4 42.0 34.7

Plumbing and heating ........... 22.1 16.8 23.7 22.2 23.4

Electrical ..................... 9.2 14.2 8.8 8.0 8.6

Plastering and lathing ......... 8.1 9.8 7.2 8.1 9.2

Masonry ...................... . 4.1 7.4 3.7 3.3 5.3

Tile and terrazzo work ......... 4.0 3.3 5.1 3.6 2.3

Structural and ornamental metal .. 2.7 3.2 3.1 2.4 1.8

Painting ....................... 2.5 2.5 2.5 2.5 2.9

Roofing and sheet metal ........ 1.3 •6 1.5 1.2 2.5

Site preparation and excavation .. .8 1.3 .5 1.0 .8

All other types ................ 6.0 4.9 6.5 5.6 8.5

1/ Although construction of projects studied extended over a 3|—year

period, most of the construction took place in 1959-60.

2/ Based on data from federally aided hospital projects only.

NOTE: Because of rounding, sum of individual items may not equal 100.

Table 8. Average Number of Contractors per Hospital Construction Project,

by Cost Group and Region, 1959-60 1/

Cost group United

States

Northeast

North

Central South West

All groups .................. 26 27 _____25.. - -.23 ..... „3JL

Under $500,000 ................. 17 (2/) 19 14 20

$500,000-$999,999 .............. 21 (2/) 22 22 —-

$1,000,000-$!,999,999 .......... 31 26 25 24 46

$2,000,000 and over ............ . 41 34 43 42 42

1/ Although construction of projects studied extended over a 3^-year

period, most of the construction took place in 1959-60.

2/ Insufficient coverage to warrant presentation.

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Plumbing and heating and Electrical contractors together accounted for

31.3 percent of the total man-hour requirements nationally. This percentage

varied but slightly among the four regions, including the South, reflecting

the relatively heavy requirements for these services in the construction of

hospital facilities. Plastering and lathing contractors accounted for 8.1

percent of the total man-hour requirements nationally and this was close to

the percentage among the various regions, evidencing the almost universal use

of plaster for interior walls as well as its substantial use for ceilings in

the sample projects.

The average number of prime and subcontractors on each project was 26.

(See table 8 .) However, this number varied considerably with size of project,

because the larger and more costly ones required a higher degree of contractor

specialization.

The Cost of Direct Wages 8/

Wage payments to on-site labor averaged 28.8 percent of the total contract

amount for the 36 hospitals, (new construction and additions, combined), for

which such data were available. (See table 9.) New construction averaged

27.8 percent for wages; additions averaged 31.6 percent. The percentages

reflect the combined effect of man-hour requirements and wage rates for individual projects.

Higher-than-average hourly earnings were generally accompanied by above

average wages as a percent of contract amount, where s man-hours remained

relatively constant. However, for new hospitals only, higher-than-average

hourly earnings among the projects were partially offset by lower man-hour

requirements.

Variations in average hourly earnings probably reflect the distribution

of work between metropolitan and nonmetropolitan areas more than any other

single factor. Usually, wage rates tend to be higher in metropolitan areas

than in less densely populated areas in the same region. Among other things,

this appears to account for the fact that multistory buildings, buildings with

several elevators, and in general, costlier projects, are associated with

higher average hourly earnings, since these projects are usually in the larger

ur’ an centers.

8/ For this study, as in prior publications in this series, "direct

wages" include pay for all hours worked, including premium overtime pay.

Excluded are vacation and holiday pay or other labor costs, such as employer

contributions to social security, insurance, and welfare, and pension funds.

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Table 9. Average On-Site Hourly Earnings on Hospital Construction Projects, by Selected Characteristics and Region 1/, 1959-60 2/

United States Northeast North Central South west

Characteristic Average

hourly

wage

Wages as

percent of

contract

Average

hourly

wage

Wages as

percent of

contract

Average

hourly

wage

Wages as

percent of

contract

Average

hourly

wage

Wages as

percent of

contract

Average

hourly

wage

Wages as

percent of

contract

All hospitals .......................... 53.18 28.8 $3.43 31.9 $3.30 28.1 $2.94 28.2 $3.72 30.3

New ........................................ 3.15 27.8 3.31 28.7 3.29 25.3 2.96 28.7 3.79 30.8

Additions .................................. 3.26 31.6 3.54 35.1 3.31 33.1 2.75 24.5 (2/) (2/)

In a metropolitan area .................... 3.31 30.6 3.54 35.1 3.33 28.8 3.17 30.5 3.85 35.1

Not in a metropolitan area ................ 2.94- 25.6 3.31 28.7 3.22 26.3 2.51 23.9 3.55 25.3

Construction cost group:

2.66 26.6 Under $500,000 .......................... 2.92 25.5 — — 2.98 25.7 24.8 3.40

$500,000-$999,999 ....................... 2.91 25.9 (2/) (2/) 3.31 26.4 2.28 22.2 — —

$1,000,000-$1,999,999 ................... 3.11 28.0 Q /) (2/) 3.37 27.3 2.34 24.5 3.85 31.9

$2,000,000 and over ..................... 3.28 30.0 3.51 32.4 3.32 29.0 3.19 30.0 — —

Type of structural framing:

3.66 24.8 Steel .................................... 3.20 26.2 3.44 32.4 3.05 22.6 2.95 25.0

Reinforced concrete .................... 3 . K 30.6 (2/) (2/) 3.30 31.6 2.97 29.6 3.76 34.8

Load-bearing masonry .................... 3.35 28.9 — — 3.78 32.2 2.65 23.2 — —

Wood ..................................... (2/) (3/) — —

— — — — (2/) (2/)

1 s t o r y .................................... 2.94- 24.8 _ _ 3.13 25.7 2.49 23.6 3.66 24.7

2-4 stories ............................... 3.11 30.1 3.24 30.7 3.24 29.6 (2/) (2/) 3.76 34.8

5 or more stories ......................... 3.29 29.7 3.51 32.4 3.44 28.3 3.16 29-6 — —

Elevators .................................. 3.23 29.4 3.43 31.9 3.32 28.2 3.03 29.0 3.71 33.7

No elevators .............................. 2.76 2 4 .0 —

— 3.01 2 6 .1 2.41 23.3 3.75 23.5

Air-conditioned:

Full ..................................... 3.14 28.6 (2/) (2/) 3 .3 0 2 8 .1 2.95 28.4 3.85 31.9

Partial ................................. 3.41 30.4 3.44 32.4 3 .3 0 2 7 .2 — — 3.50 26.4

Not air-conditioned ................. 2.84 24.7 — — (2/) (3/) a / ) (2/) (3/) (2/)

Full or partial basement .................. 3.25 29.2 3.50 33.6 3.29 28.1 3.13 2 9 .2 3.50 26.4

No basement ............................... 2.97 27.4 (2/) (2/) 3 .3 2 2 7 .6 2.20 23.8 3.80 31.2

Exterior:

Masonry ................................. 3.17 29.3 3.43 31.9 3.32 30.0 2.97 28.4 3.55 25.3

Curtain wall ............................ 3.05 23.3 — — 3.24 23.6 (2/) (2/) — —

O t h e r ......... .......................... 3.85 35.1 — — —

— —

— 3.85 35.1

1/ Based on federally aided projects only.

2/ Although construction of projects studied extended over a 3^-year period, most of the construction took place in 1959-60.

2/ Insufficient coverage to warrant presentation.

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Some of the hospital projects differed substantially in the ratio of

wages to total construction. Aside from the extent of alteration work which

generally accompanied construction of additions, there were special conditions

involved such as site problems, or unusual labor arrangements such as travel

time included at regular hourly rates. The range of wages as a percent of

contract for which a distribution of hospital projects could be made (36

hospitals) was as follows:

Percent wages

were of contract cost

Percent of

hospitals studied

Under 2 0 . 0 .... ..................... 5.6

20.1- 22.5 .......................... 11.1

22.6- 25.0 .......................... 22.2

25.1- 27.5 .......................... 19.4

27.6- 30.0 .......................... 19.4

30.1- 32.5 .......................... 5.6

32.6 and o v e r .................. . 16.7

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Off-Site Employment

For each man-hour of employment performed on the construction sites, an

additional 1.5 man-hours of work were required to produce and distribute the

necessary construction materials, supplies, and equipment used in construction

of general hospitals. These projects, thus, gave rise to 134 man-hours of

such employment per $1,000 of contract, compared with 89 hours on-site.

Off-site employment is generated in many places, but can be classified

in the following categories:

1. Construction industry--off-site: administrative, estimating, and

warehousing functions.

2. Manufacturing activities producing fabricated and raw materials and

equipment.

3. Transportation, warehousing, and distribution of fabricated and raw

materials and equipment.

4. All other industries directly or indirectly affected by the production of fabricated and raw materials. Various interindustry transactions

eventually affect all additional industries such as agriculture, forestry,

and mining.

There are, of course, o -V ~ people affected in types of employment which

this study -id not attempt to cover. Some of these are mentioned on page 2*

Of the workers omitted, the most numerically important groups, who would be

directly affected by a hospital construction program, were employees in architectural firms, utility companies, and State and local governments. These

employees and their functions were not included in the construction contract

cost. A large area of employment also excluded from the calculations of

man-hour effects, as mentioned earlier, is that created by the respending and

investing of wages and profits arising in various areas of economic activity

within the scope of this study.

Although the ratio of on-site to off-site employment requirements is

commonly used in analyzing employment requirements in the construction industry, another type of distinction based upon the economic relations of the

labor-generating areas is also useful. Therefore, employment requirements

have also been divided into primary and secondary man-hour needs. As shown in

the following tabulation and chart 1, the primary man-hour requirements, estimated at 162, arise in the activities at the site and those most directly

related to the construction activity. Included in these, in addition to site

employment, are off-site construction employment, employees of manufacturing

industries represented at the "last stage of manufacturing" for materials

prior to shipment to the site, and employees in transportation, trade, and

service organizations dealing in materials used at the site.

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Secondary man-hour requirements have been defined as those associated

with all other requirements indirectly related to the needs at the site.

Such activities totaling 61 hours or 27 percent of total man-hour requirements

affect all parts of the economy as the impact of primary activity is reflected

in demand for basic materials and related transportation, trade, and services. 9/ The following tabulation shows man-hours of employment associated

with $1,000 of hospital construction.

Total

Primary

activities

Secondary

activities

All industry g r o u p s ...... . 162 61

Construction ..................... 100

On-site ........................ 89 - -

Off-site ....................... 11

Manufacturing ........... ......... 44 33

Transportation ......... ........ . 5 4

Trade and service............. 13 9

Other ............................ — 13

Some industries are represented in both the primary and secondary sectors. For example, the sand and gravel industry furnishes material directly

to the construction inC stry and also to the ready-mix concrete industry

which in turn sells to the construction industry.

Builders* Off-Site Employment

An exact study of off-site employment of contractors was not attempted,

since it was almost impossible to relate accurately such employment to the

projects being studied. Builders* off-site employment was occupied not only

with the projects studied but also with other current or future projects of

the builders.

The estimate of 11 man-hours of such work for each $1,000 of contract is

based on the difference between construction vjorker employment and total

employment in the contract construction industry. 10/ This estimate also

includes self-employed craftsmen who ma; have worked at the site.

97 Secondary man-hours were estimated on the basis of a study made by

the Bureau of 1947 interindustry relationships. See W. Duane Evans and Marvin

Hoffenberg, Interindustry Relations Study for 1947, Review of Economics and

Statistics, Vol. XXXIV (1952), Cambridge, Mass. For methods employed, see

anpendix A.

10/ Administrative, engineering, estimating, and clerical workers

accounted for about 14 percent of total employment in the construction industry. About one-fourth of this employment was involved at the site.

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Combining this employment with on-site employment results in an estimate

of 100 hours of employment in the construction industry for each $1,000 of

general hospital construction.

Employment in Transportation, Trade, and Service

Distribution of construction materials from the producing industries

requires employment of workers in the transportation, warehousing, and trade

industries. The estimate of 18 hours of primary employment per $1,000 of

contract is based on the difference between producer’s value and delivered

value of materials used at the site. This estimate covers only the distribution of materials from the producers to construction site and does not include

the distribution of materials among industries prior to shipment of the completed products.

"Last Manufacturing Stage” Employment

The sector of the economy most affected by hospital construction, other

than the construction industry, is manufacturing. An estimated 44 man-hours

were required for each $1,000 of total contract for production of the construction materials used in the building of hospitals. This estimate, however,

includes only employment required in the last manufacturing process of the

materials. 11/ Employment generated by this activity is distributed in many

industries directly affected by construction activity. For example, it includes sawmills cutting rough lumber for forms, and establishments making

millwork items from lumber, but does not include employment in sawmills producing lumber for millwork products. The latter is included in the estimate

of secondary employment discussed below.

Employment in Secondary Activities

In addition to the 44 man-hours previously noted for primary employment

for each $1,000 of hospital construction contract in the factories making

construction materials, an additional 35 hours were required in secondary

manufacturing activities.

Transportation industries required 4 hours of employment to transport the

materials to and from the industries indirectly affected.

Trade and service industries as a group required 9 hours of employment

for each $1,000 of hospital construction to meet the needs of secondary business activity.

Other business activities, primarily agriculture, forestry, and mining,

accounted for the remaining 13 hours of secondary man-power requirements.

11 / Included in the bill of materials were the supplies and the expended

value of the equipment used by construction contractors.

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Construction Time

Average construction time required for the projects surveyed was approximately a year and a half. (See table 10.) The construction period varied on

individual projects, however, from 21 weeks on the smallest to 151 weeks on

one of the largest.

Significant differences existed not only by size of project but also by

region, due to the influence of climatic conditions. In the Northeast and

North Central regions, more-than-average construction time was required, in

contrast with the West and South, where less-than-average time was used. In

fact, in the South, where construction is usually a year-round industry, construction time for comparable projects was consistently below average.

Employment by Construction Periods

Construction time for each hospital was divided into 10 equal parts. For

example, a hospital which took 15 months to complete was studied in ten 1.5

month periods. This permitted the combination of projects of various sizes

to obtain a typical employment pattern. Thus, the percent of total man-hours,

for all the hospitals by decile, were as follows:

1 s t .... . 6th .........

2d ........ ...... 8,4 7 t h ........ 13 • 0

3d ..... . ...... 11.9 8 t h ........ ....... 10.5

4th ........ ...... 13*4 9th ........ ,..... 7.1

5 t h ...... . 1 0 t h .......

Generally, employment started slowly, built up to a peak in the fifth

period, and dropped off sharply in the last two. Seventy-seven percent of the

on-site employment occurred in the third through the eighth periods, that is,

in the middle 60 percent of the elapsed time. Employment accounted for about

4 percent of the total man-hours in both the first and the last periods.

(See chart 3.)

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Table 10. Average Number of Weeks Required for Construction of Hospitals,

by Cost Group and Region, 1959-60 1/

Cost group

United

States Northeast

North

Central South West

All groups ................. 77 90 81 68 7A

Under $500,000 ............... 53 (2/) 66 50 IS

$500,000-$999,999 ............ 69 (2/) 70 62 —

$1,000,000-41,999,999 ........ 79 82 81 80 76

$2,000,000 and over ........... 118 125 126 109 1H

1/ Although construction of projects studied extended over a 3^-year

period, most of the construction took place in 1959-60.

2/ Insufficient coverage to warrant presentation.

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Chart 3. On-Site Man-Hours of Construction Labor

for Each $1,000 of Hospital Construction Contract

By Decile of Construction Time

Man-Hours

Deciles of Construction Time

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Materials Used

Costs of materials represented 54.4 percent of total contract value of

all projects. For new hospital projects only, the average materials value

was 55.7 percent, and for additions projects the average was 51.3 percent.

These totals include depreciation charges or rental costs for construction

equipment used and costs of the small amounts of supplies consumed, in addition to the materials or fixed equipment incorporated in the structures.

Although the lower materials value of the additions projects may reflect some

reduced materials requirements for a few operations, it appears primarily to

be due to the higher percentage of total contract amount paid to on-site labor

as a result of alteration and repair work on such projects* The majority of all

the projects were within 5 percent of the overall average for materials

costs:

Percent materials cost of Percent of

total contract amount projects

45-49 ...................................... 22

50-54 ...................................... 26

55-59 ...................................... 28

60-64 ...................................... 20

65 and over .................. 4

The difference between the total construction contract value and the sum

of materials and wage costs amounted to 16.8 percent of the cost of all the

projects. This represented the total of those overhead costs \diich cannot be

attributed to specific projects, such as administrative off-site salaries,

expenses of central office and yard operation, insurance and taxes, plus other

overhead, and profit. These two components (overhead costs and profit) could

not be separated in this survey.

Table 11 presents the costs of major materials and groups of materials

used in each $1,000 of construction for all the hospital projects, and also

shows these cost breakdowns for new projects and for additions. The groups,

and the items within the groups are ranked by amounts spent for the products,

on all projects. Although the table presents the costs of materials in terms

of their dollar value, the individual items may be readily reduced to the

familiar magnitudes of percentages. Thus, the sum of $543.80 shown for ”A11

hospital projects” under ”A11 products” would be 54.4 percent.

The proportion of total materials costs per $1,000 of contract amount for

new hospital projects was somewhat higher than that for additions. However,

analysis of the relative materials costs by each of the major materials groups

for all of the projects, and separately, for new projects and additions, indicated fairly constant relationships between and within each of the construction

categories.

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Table 11. Total Cost of Material Components for E a c h $1,000 of Hospital Construction Contract,

1959-60 1/

All New Hospital

Selected products and product groups hospital hospital addition

projects projects projects

All products ................................ ............... $54-3.80 $556.70 $512.80

Metal products (except plumbing and heating) ................... . 14-5.90 150.00 136.10

Fabricated structural metal products .......................... 97.20 102.50 84.70

Reinforcing bars and joists ................................ 36.50 38.80 31.00

Structural steel ............................. ............. 21.50 23.60 16.20

Fabricated sheet-metal ................................. . K .60 15.30 13.10

Metal windows ............................................. 12.20 12.00 12.50

Metal doors ................. ......... . 7.80 8.00 7.40

Ornamental metal ............................. ............. 3.90 4-. 20 3.30

Other ............................ ......... ................ .80 .70 1.10

Other fabricated metal products .............................. 10.90 10.30 12.60

Builder's hardware ......... ............................... 10.60 9.90 12.10

Other ......... .......... . .4-0 .30 .40

Other metal products ......................................... 37.70 37.30 38.80

Metal casework ............................................. 13.60 13.80 13.10

Copper products ....... .................................... 8.30 8.4-0 8.30

Galvanized sheet-metal ................ ..................... 4-.90 4 .10 6.80

Partitions, lockers, and shelves ............................ 3.80 3.40 4.70

Other ......... . 7.10 7.60 6.00

Stone, clay, and glass products ............................ . 105.50 103.60 110.00

Cement, concrete, and gypsum products ......................... 51.60 51.80 51.30

Ready-mix concrete ......................................... 27.60 26.00 31.50

Gypsum products ................. .......................... 8.80 8.50 9.50

See footnote at end of table.

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Table 11. Total Cost of Material Components for Each $1,000 of Hospital Construction Contract,

1959-60 l / ~ C o n t i n u e d

Selected products and product groups

All

hospital

projects

New

hospital

projects

Hospital

addition

projects

Cement, concrete, and gypsum products— Continued

Concrete block ................................................ $6.30

3.80

$7.10 $4.30

Cement .............................................. . 3.70 4.00

Precast concrete prod nets 3.50

.70

4.60

.90

.70

Concrete pipe ........ ..... .................... ..... . .20

Other .......... ......... ............................ . 1.00 1.00 1.00

Structural clay products ............ .......................... 21.70 19.50

10.40

27.20

Brick and structural tile .... 12.10 16.30

Ceramic tile . t . . .. 11. ...... . .... t................ ...... . . . . . 8.10 7.20 10.20

Other ................................ ..................... 1.60 1.90 .70

Other stone, clay, and glass products ........................ . 32.10 32.40

9.60

31.60

Fiber glass products ........ ............... 9.70 10.00

Cut stone ..................................................... 6.40

5.50

3.30

2.30

1.50

3.40

77.70

6.60 5.90

Vlmrl tile ( incl udincr vinvL—asbestos} ...................... . 5.10 6.60

Window glass ............................... . 3.10 3.60

Sand and gravel ........... ..... ........................... 2.10 2.90

Asphalt tile ............ ......... ................ 1.90 .70

Other ........................... .......... .............. . 4.10 1.90

Fixed hosoital eauioment ....................... . 81.20 69.20

E l evators ...................... 22.50 19.80 29.00

X—ray and related equipment ........... . 12.80 15.10

13.20

9.70

7.30

Sterilizers and autoclaves ................................. 12.20 9.70

Kitchen equipment........................ . 7.20 1.00

Refrigerators ........... .................... .............. . 6.70 6.50 7.20

Laundry equipment 4.90

3.40

5.00 4.60

Ranges................... ....................... ........... 3.70 2.80

See footnote at end of table.

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Table 11. Total Cost of Material Components for Each $1,000 of Hospital Construction Contract,

1959-60 l / — Continued

Selected products and product groups

All

hospital

projects

New

hospital

projects

Hospital

addition

projects

Fixed hospital equipment— Continued

Laboratory equipment .................... ..................... $2.90 $2.70 $3.30

Compressed air and oxygen systems ............................ 2.50 2.80 1.60

Other 11 r 111111 f .... f 111. ......... ............................ 2.60 2.60 2.70

Electrical equipment, fixtures, and wire ........................ 65.30 68.20 58.50

Lighting fixtures ............................................ 15.40 15.90 14.20

Noncurrent-carrying devices .................................. 10.80 10.90 10.70

Switchboards and panelboards ................................. 10.70 11.40 9.10

Intercom and fire alarm system............................. 6.00 5.70 6.70

Electric generating units .................................... 5.80 6.50 4.20

Wire and cable ............................................... 5.10 5.30 4.90

Transformers t f 11. .................. . t.. t....... .............. . 3.20 3.80 1.80

Program systems ............................................ 1.90 2.70 .10

O t h e r ................................... ......... ........ . 6.40 6.10 6.90

Heating, ventilating, and air-conditioning equipment ............ 53.80 57.90 44.10

Radiators, convectors, and boilers ............................ 14.90 16.30 11.70

Air-conditioning equipment ................................... 14.60 16.30 10.40

Temperature controls ...................................... . 10.30 11.30 8.00

Blowers, exhaust, and fans ................................... 4.80 4.50 5.60

Unit heaters and ventilators ................................. 2.40 2.70 1.40

Warm air furnace ......................... ................... .10 .10 .10

Other . .. ............... ..................... ........... . 6.80 6.70 7.00

Plumbing products ............... .............................. 47.00 46.90 47.10

Plumbing fixtures ................................. .......... 15.50 16.20 14.00

Steel and galvanized pipe .................................... 14.50 13.10 18.00

Valves and specialties .......................... ............. 10.00 10.00 10.20

See footnote at end of table.

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Table 11. Total Cost of Material Components for Each $1,000 of Hospital Construction Contract,

1959-60 1/ — Continued

Selected products and product groups

All

hospital

projects

New

hospital

projects

Hospital

addition

projects

Plumbing products— Continued

Cast iron pipe ..........

Other ..................

$5.80

1.10

$6.50

1.20

$4.10

.90

Lumber and lumber products

Millwork ..............

Rough and dressed lumber

Other ................

22.60

16.20

5.40

1.00

21.10

14.70

5.10

1.30

26.40

19.70

6.10

.50

Petroleum products ......

Asphalt paving .......

Asphalt and tar pitches

Asphalt felts ........

Other...............

5.30

1.40

1.30

1 .0 0

1.70

5.90

1.90

1.30

.90

1.80

4.00

.40

1.20

1.00

1.30

Paint and other chemical compounds

Paint ........................

Other.......... .............

4.40

2.50

1.90

4.50

2.60

2.00

4.00

2.40

1.60

All other............

Construction equipment

Insulating board ....

Other ..............

16.30

11.20

.50

4.60

17.40

11.90

4.90

13.60

9.50

.30

3.80

1/ Although construction of projects studied extended over a 3^-year period, most of the

construction took place in 1959-60.

NOTE: Group totals include products not shown separately. Because of rounding, sums of

components may not equal totals.

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The most important broad materials category, "Metal products (except

plumbing and heating)," accounted for almost 15 percent of the total construction contract amount of all the projects studied. 1_2/ The items used in

structural framing— "Reinforcing bars and joists," and "Structural steel"--

tnade up about two-fifths of the "Metal products" group, and metal doors and

windows, about one-seventh. This group does not represent the total contribution of the metalworking industries, since it excludes the metal products

shown separately in the equipment categories.

By far the largest single item among "Stone, clay, and glass products"

was ready-mixed concrete, which at 2.8 percent, accounted for more than onequarter of the value of the group. This material constituted the frames of

more than one-third of the projects, and the floors and roof decks of most of

them. The small amounts of the raw materials of concrete separately shown—

cement, sand, and gravel— were used in specialized applications such as terraziio

'■^rk.

"Fixed hospital equipment," the third most important broad materials

category, accounted for almost 8 percent of the total contract cost of all the

hospital projects. Elevators accounted for more than one-quarter of the value

of this group. The "X-ray" and "Sterilizers and autoclaves" items together

made up almost one-third. For additions alone, these latter two items were

considerably below the percentage shown for all projects and the somewhat

higher percentage shown for new hospitals. This reflected, in part, some

additions in which this type of equipment was not required because the existing structures were adequately equipped with them. This was also true with

regard to "Kitchen equipment."

"Electrical equipment, fixtures, and wire" amounted to 6.5 percent of the

total cost of all the projects.

The proportion, 5.4 percent, shown for the group "Heating, ventilating,

and air-conditioning equipment" completely covers equipment requirements for

this type of work. The extensive duct materials needed for air exchange

throughout a building are included in "Fabricated sheet-metal products" or in

"Galvanized sheet-metal" under the "Other metal products" group.

Other major materials groups were "Plumbing products," representing 4.7

percent of total projects cost, and "Lumber products," 2.3 percent. "Millwork"

accounted for almost three-quarters of the total cost of the latter group and

included wood casework. The largest amount of lumber products was used in the

West.

12/ Each "percent of construction contract" represents about $11.6

million of annual expenditures at the current (1961) annual rate of all hospital and related medical facilities construction (e.g., $169.4 million of metal

products is represented by the 14.6 percent).

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Changes in Materials

A comparison of construction costs in the present study with those in the

study made about 20 years ago indicates that the proportion that materials

represent of total construction cost has changed only moderately between the

two periods, increasing from 50 percent to 54 percent. However, the proportions that individual materials represent shows some very marked changes,

reflecting different materials usages for similar purposes, changing standards

and requirements, and different price movements. The following tabulation

presents some of these changes for a number of groups of materials. Data from

the current survey are shown for all projects studied. Although little is

known of the characteristics of the projects in the older survey, it is believed that they were relatively comparable with those in the current study as

they included only new construction, presumably, of new hospitals and additions.

Percent of total

materials cost

Materials group 1/ 20 years Current

“ a8° study

All m a t e r i a l s............................ 100.0 100.0

Iron and steel and their p r o d u c t s................... 36.0 44.3

Structural steel ...................... 6.5 4.0

Reinforcing steel .............................. 3.5 6.9

Plumbing supplies and fixtures .................... 8.2 8.8

Heating and ventilating equipment........ 10.1 10.2

Hardware, miscellaneous .................. 2.4 2.0

Metal doors, windows, shutters, and t r i m ......... 2.5 3.8

Wire and wire works p r o d u c t s....... .4 .1

Other iron and steel products ..................... 2.4 8.5

Stone, clay, and glass p r o d u c t s............. 32.5 18.2

Cement ........................... 7.5 .7

Brick, hollow tile, and other clay p r o d u c t s..... . 9.5 2.6

Sand, gravel, and crushed s t o n e ................... 5.0 .7

Marble, granite, slate, and other stone products .. 2.2 1.2

Concrete and concrete p r o d u c t s....... ......... 3.6 7.1

Wall plaster and wall b o a r d ........... 1.5 1.7

Tiling, floor and wall, and terrazzo ...... 2.4 1.7

G l a s s .............................................. .8 2.5

Forest p r oducts............................ 15.5 4.4

Electrical wiring, fixtures, and supplies ........... 5.4 11.2

Roofing, insulation, and waterproofing *............ 2.7 .6

Paints, varnishes, and other chemicals....... 1.1 .5

Sheet metal .................................... .9 2.3

All other materials ............................ 5.9 18.6

1/ Products were grouped to conform with the previous study.

Note: Because of rounding, group totals may not add to 100.

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These comparisons illustrate some basic shifts over the years. Additional

new fixed equipment has had the effect of reducing the relative importance of

older materials, even though the latter are still used extensively. Thus, although some masonry such as brick, hollow tile, and other clay products was

used as the exterior material in nearly all of the projects in the current

study, it accounted for only 3 percent of total materials cost, compared with

10 percent in the earlier study.

A change in construction method during the period is strikingly illustrated. Twenty years ago, concrete was commonly batched and mixed at the construction site; the use of ready-mixed concrete was just beginning to assume

significance. Today, ready-mixed concrete is more commonly used on construction jobs. This accounts in part for the decline in the total for cement, and

sand, gravel, and crushed stone (the raw materials of concrete) from almost

13 percent of material cost to 1 percent, and for the increase in concrete and

concrete products from almost 4 to 7 percent. The rise in use of new types of

materials, not necessarily serving entirely new purposes, and the decline in

more traditional materials are reflected in the increases for glass and metal

doors, windows, shutters and trim, and the decrease in forest products. For

example, 20 years ago, fiberglass was a novel building material; today, it is

preferred for several acoustical and thermal applications.

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Requirement Comparisons With School, Public Building,

and Highway Construction

A comparison of requirements for the four types of construction studied

by the Bureau for this series of reports reveals that although total man-hours

per $1,000 of contract are remarkably similar, there is some variation in

requirements among the affected industries:

Total man-hour requirements per

______ $1,000 of construction contract________

Buildings

Federal

Highways 1/ Schools office Hospitals

buildings

All industries....... < 212 227 223

Construction, on site .... ___ 94 84 97 89

Off-site .................. 128 130 134

Construction ............ ___ 5 10 10 11

Manufacturing ........... 78 79 79

Transportation ......... 8 9 9

Trade and service ...... 20 20 22

Mining ..................___ 23 (2/) (2/) (2/)

Other ................... 12 12 13

1/ Data for highways relate to 1958; data for schools and Federal buildings relate to 1959. If the highway data were adjusted for increases in prices

and productivity between 1958 and 1959, the total hours would probably not

differ substantially from those for schools.

2/ Included in "Other."

Comparison of data for the "Buildings" group shows that on-site time for

hospitals was approximately 6 percent more than that for schools, and 8 percent

less than that for public buildings. However, schools and public buildings

involved the construction of new buildings only, whereas the hospital projects

included additions to existing buildings. When new hospitals only were considered, the on-site hours were virtually the same as those for schools. The

higher requirements for public buildings appear to reflect their previously

noted more monumental quality. The somewhat higher off-site requirements for

hospitals than for schools or public buildings appear to be due in some measure

to the relatively large amount of fixed, built-in hospital equipment. Requireing relatively little time at the site in relation to its cost, this type of

equipment tends to increase the off-site hours in the manufacturing and nonmanufacturing industries.

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When "Buildings" are compared with "Highways" it should be borne in mind

that because of the basic differences in locations and construction processes,

relatively more operations are performed at the site of highway than of building construction. For example, the bulk of the concrete used in highway work

is batched and mixed on-site by the contractor’s own forces; ready-mixed concrete is used only for the smaller applications. On the other hand, as

previously noted, most concrete used in building construction is ready-mixed.

Moreover, the highway contractor’s forces produce and process more than half

of the aggregate required in their concrete, using sources as close as possible

to the batch plants. Further, maintenance and other supporting services are

necessarily performed on-site to a greater extent for highway than for building construction. This in part accounts for the differences shown in off-site

requirements in the construction industry.

Differences in industry impact between highways and the buildings segments

reflect differences in the construction process. In the case of highways,

skilled workers operate extremely expensive units of equipment to move earth

and place materials of a relatively low order of fabrication; in building construction, most of the journeymen manually place materials of relatively high

cost and degree of fabrication. Thus, in the preceding tabulation, manufacturing man-hours are considerably lower for highway than for building construction, whereas mining hours are higher, reflecting the labor used in extracting

rock, sand, and gravel.

Some of the basic differences are further illustrated by the percent

distribution of construction costs:

Buildings

Federal

Highways \J Schools office Hospitals

buildings

Total ................. 100.0 100.0 100.0

M a t e r i a l s .................. 54.1 51.3 53.3

On-site wages ............. 25.7 29.0 28.8

Equipment 2/ .......... . 1.4 1.9 1.1

Other 2/ ................... 18.8 17.8 16.8

1/ Based on data from the U.S. Bureau of Public Roads.

7J Rental or depreciation charges.

2/ Overhead and profit.

Materials requirements for highways and buildings, although similar in

percent of total construction cost, are different in type. For highways, fourfifths of the total materials value was accounted for by concrete (cement and

bituminous), structural and reinforcing steel, and equipment fuels and lubricants. These represented a relatively minor portion of total materials costs

for buildings.

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Similarly, the share of total on-site wages received by some construction

trades differed radically on the two types of construction. Thus, on highway

construction nearly one-third of all on-site wages were paid to equipment

operators (excluding truckdrivers), compared with less than one-thirtieth on

building construction. Truckdrivers received more than 10 percent of all

on-site wages for highway construction, but less than 1 percent for building

construction. Unskilled workers, however, appeared to receive only a little

more of the on-site wage dollar in high ay than in building construction,

although available data do not afford a precise comparison.

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APPENDIX A. Scope and Method of Survey

This study was designed to develop estimates of man-hour requirements

associated with the construction of both public and private profit or nonprofit general hospitals. Project data obtained from or relating to activity at

the construction site, as well as information based on secondary data such as

the Census of Manufactures, were utilized.

General hospitals, as defined by the Department of Health, Education, and

Welfare, are for inpatient medical or surgical care of acute illness or injury

and for obstetrics, of which not more than 50 percent of the total patient days

during the year are customarily assignable to the following categories of

cases: chronic convalescence and rest, drug and alcoholic, epileptic, mental

deficiency, mental, nervous and mental, and tuberculosis. Construction of

hospitals (or nursing homes) primarily engaged in serving the medical needs of

patients with illnesses falling in the latter descriptive categories was not

included in the study.

Characteristics of the Universe and Selection of the Sample

A single, complete listing of all public and private general hospital construction started between mid-1958 and mid-1959, the period selected for study,

was not available. It was, therefore, necessary to use several sources to

obtain what was considered to be a representative, if not exhaustive, universe

from which to draw a sample of projects for survey purposes. 13/ Approximately

four-fifths of the projects in the universe so established consisted of nonprofit

public and voluntary general hospitals, constructed with Federal financial

assistance (as provided in the Hill-Burton Act), and the remaining fifth were

not so assisted. (Hospitals built entirely with Federal funds--!.e., for

veterans, armed service personnel, etc.--were excluded.)

As distinguished from the earlier studies concerning public school and

Federal public building construction, vrtiere only new schools or buildings were

considered, the hospital projects studied included new hospitals, additions to

existing hospital structures, and alterations to the existing structures where

these were part of the construction contracts for the addition projects. Situations involving renovations only, as distinct from alterations as part of an

addition project, were not studied.

13/ Sources included contract award reports of F. W. Dodge Corp., Modern

Hospital Publishing Co., Inc., and Construction Statistics Office of the Bureau

of the Census. Also, the "Hospital and Medical Facilities Project Register,

December 31, 1959," Division of Hospital and Medical Facilities, the Public

Health Service, U. S. Department of Health, Education, and Welfare. All sources

were crosschecked and project duplications eliminated.

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Additions (and alterations incident thereto) were felt to be too important a part of total hospital construction to be excluded from the study. In

1959 and 1960, approximately 63 percent of Federal assistance funds for hospital and related projects were provided for additions and alterations projects.

Moreover, the demand for construction of additions was believed comparable to

that for new hospital construction.

The projects in the universe were stratified by four geographic regions

(Northeast, North Central, South, and West), by total construction cost, and

by metropolitan and nonmetropolitan area. 14/

A sample of 46 projects, approximately one-quarter of known units of the

total universe, was selected. The projects were selected at random from the

above three groupings. Although construction of the projects studied extended

over a 3%-year period, most of the construction took place in the period July

1959 through June 1960.

Man-Hour Estimates. The customary presentation of employment data for

construction projects includes estimates for on-site and off-site employment.

Such a presentation is followed by this study. In addition, however, there is

an economic distinction which can be made in analyzing man-hour requirements

for construction. The basic grouping in this instance would be the primary

and secondary labor effects of construction expenditures, with the primary

sector including the on-site employment plus the off-site employment directly

related to the activity at the site.

Primary man-hour requirements, for purposes of this report, include, in

addition to all on-site labor, the construction contractor’s office employment,

the labor required in those manufacturing industries trfiich fabricate the construction materials used on the site--that is, the "last stage of manufacturing”

companies, plus all trade, distribution, and services involved in placing the

construction materials at the site. Secondary employment includes all other

labor requirements necessary to produce and transport the raw materials and

semifinished products to the factories which finally produce the items used at

the site.

14/ The States included in each of the regions were as follows:

Northeast— Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New

York, Pennsylvania, Rhode Island, and Vermont; North Central— Illinois, Indiana,

Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio,

South Dakota, and Wisconsin; South— Alabama, Arkansas, Delaware, District of

Columbia, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North

Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and West

Virginia; and West— Arizona, California, Colorado, Idaho, Montana, Nevada,

New Mexico, Oregon, Utah, Washington, and Wyoming.

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Data for on-site hours were generally collected from payroll sources.

All other labor requirements discussed below, whether considered primary or

secondary, were established by use of secondary data.

Collection of On-Site Man-Hour Data

Although the type of construction labor and materials requirements data

sought was similar for both nonfederally and federally aided hospital projects,

the sources for the data differed. For the construction of nonfederally

assisted hospitals, those financed entirely by various levels of local governments, private individuals or voluntary groups, data were obtained by field

representatives from local authorities, hospital administrators, architects,

contractors, and other direct participants in these projects. For the federally assisted hospital projects, man-hour data were made available from records

which were required under the Federal assistance program. Access to these

records made possible the collection of some additional detail for these projects. This included information on wage relationships, timing of construction operations, and requirements by type of contractor.

Under the Federal legislation whereby Federal assistance may be granted

for the construction of public and voluntary nonprofit hospitals of all types,

after study and survey by a State substantiates the need, the individual States

are given the authority for administering the program /Hospital Survey and

Construction Act of 1946 (Hill-Burton); now referred to, with its amendments,

as Title VI of the Public Health Service Act/. 15/ General coordination and

supervision are exercised by the Public Health Service of the U.S. Department

of Health, Education, and Welfare. Financing is by all parties, jointly,

under a variable matching formula, depending on need and ability to pay.

When a hospital is built with a Federal grant, each prime contractor and

subcontractor engaged on the project is required by the legislation to submit

to the administrator of the sponsoring hospital, a copy of each weekly payroll

showing (with other information) the daily and weekly hours worked, the gross

weekly earnings, and the occupation of each mechanic and laborer on the particular project. Through the cooperation of HEW, the Departments of Health of

the various States, and the hospital administrators, copies of the payrolls

for the federally aided hospital projects in the sample, along with lists of

the contractors on the jobs, were made available to the Bureau. These payrolls

provided the data for estimating on-site man-hour requirements, as well as data

on wages for all hourly rated workers on the projects. Data for on-site

salaried employees, not accounted for on the payrolls, were obtained by the

field agents from the contractors. In a few cases, the requested payroll

records were not available or were inadequate as data sources. For these situations, alternate projects were substituted.

15/ Public Law 725, 79th Congress, as amended, approved August, 1946

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In the nonfederally aided hospitals, the data for on-site labor requirements were generally derived from payroll or labor cost records, or daily work

force reports, obtained directly from the contractors engaged on the projects.

Only summary man-hour data by occupation were requested from the contractors.

For a small number of contractors whose records could not be used to isolate

the data for specific hospital projects, estimated hours and materials costs

were substituted.

Off-Site Man-Hours

From contractors and subcontractors cooperating in the study, a price list

was obtained of the value of each type of material used in the sample projects.

These material listings were classified into categories consistent with 5-digit

Census of Manufactures product groups. For each of these product groups, the

average amount used per $1,000 of contract construction was determined. Once

the average use was calculated, each figure was reduced by a ratio representing

the difference between valuation by the purchaser and valuation by the producer. 16/ Since all data reported by contractors were in purchasers* value,

reduction to producers* value made the figures consistent with Census data

published on these various components. These figures on average dollar value,

stated in producers* value of each construction material used per $1,000 of

contract value were necessary for each of the succeeding steps.

Primary Distribution Industries Employment

Man-hours in the distribution industries (trade, transportation, warehousing, freight forwarding, etc.) at the primary level with respect to construction activity were estimated from the difference between producer and

purchaser value for each construction material. The differences were summed

and allotted to trade or transportation sectors by a ratio obtained from inputs

by these sectors to new construction found in the 1947 input-output analysis.

A second allocation was made among industries within the transportation

sector (rail, truck, etc.) on the basis of 1959 value of production of the

industry. The man-hours for each distribution sector were then determined by

multiplying the value allotted to this sector by man-hours needed to produce

$1,000 of product in the distribution sectors.

Primary Manufacturing Employment

Primary employment in manufacturing was considered to be that required to

produce items in the construction bill of materials in their final stage of

fabrication. In this stage, man-hours resulting from hospital construction

were developed by multiplying average value of each construction component by

a ratio of manufacturing man-hours to $1,000 of production. 17/

16/ The ratio used for this reduction was the purchaser-to-producer ratio

for these components in hospital construction, as developed for use in the 1947

interindustry analysis.

17/ This ratio was established by using the 1959 Survey of Manufactures.

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Secondary Employment in All Industries

Secondary employment is defined as the employment in all industries involved in the production and transportation of building materials and equipment, from basic extraction to, but not including, the final manufacturing

stage.

To determine all the secondary man-hours involved in each construction

product, it was necessary to determine the contribution from each of the sectors of the economy to the construction bill of materials. To obtain these

contributions from each sector, an interindustry inverse matrix was used. The

matrix was calculated for the United States economy in 1947 by the Bureau of

Labor Statistics. 18/ Since this matrix is stated in 1947 prices, all prices

of the construction components were deflated to 1947 levels and then grouped

into industry classifications which were consistent with the interindustry

study’s 57-sector aggregation. This provided the value of construction goods,

stated in 1947 prices, for each interindustry sector. Each of these figures

was in turn multiplied by the corresponding coefficients of the inverse matrix.

This procedure indicated the contribution necessary from each of the sectors

to produce the specified construction item used. These products which were

stated in 1947 prices were then reinflated to 1959 prices (the year consistent

with the bill of materials).

Sector contributions to each of the separate construction items were

summed to obtain total contributions from each sector of the economy to the

construction bill of materials. To translate dollars of product contributed

by each sector into employment required by this sector, a ratio of employment

to $1,000 of production was used. These ratios were developed for each of 57

interindustry sectors. 19/

Total Man-Hour Requirements

From each off-site stage (primary distribution, primary manufacturing,

and secondary industry), a man-hour figure per $1,000 of hospital construction

contract was obtained. When these were summed with direct or on-site man-hours

the total employment effect, within the definition used by the study, was deter

mined. However, the procedures used in estimating employment generated by

hospital construction did not include all such employment. The technique used

18/ For a further description, see the article by W. Duane Evans and

Marvin Hoffenberg, op. cit.

19/ Both price and unit employment ratios were actually calculated on a

450-order aggregation and summed to the 57-order aggregation. The employment

figure was converted to man-hours using 3LS average annual hours in each of

the separate sectors.

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for the off-site segment covers only employment generated by direct purchases

of materials and supplies and implicit in depreciation of construction equipment. The following areas of employment related to the volume of construction

activity were not covered: (1) Architectural, surveying, estimating, and other

planning employment; (2) inspection or supervision by the architect or the

government during construction; (3) the labor time involved in installations

of public utility employees, as well as any site preparation not covered by

the construction contract; (4) the labor generated by the money expended for

contractors* overhead, other than off-site administrative salaries; (5) employment generated by purchases of movable furniture and equipment; (6) the

"multiplier" effect of the respending of wages and profits; and (7) the construction and equipment of new production facilities, if needed to supply

construction materials.

* U.S. G O V E R N M E N T P R IN T IN G O F F IC E : 1962 0 — 659571

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