What sort of comparison are you trying to do?
What are your objectives with this comparison?
How comprehensive a comparison do you need? (quick and dirty or exact and able to pass strict scrutiny) And do you have a budget that allows for the degree of analysis needed?
Are you looking for some information to bid on projects between the two countries? (i.e. Do you want to be able to say Ecuador price should be x times US price?)
Are you looking for some information for some global policy analysis comparing the labour productivity between the two countries? (i.e. Do you want to be able to say that US labour is x times as productive as Ecuadorian labour and therefore something needs to be done? Do you want to be able to say what needs to be done as well?)
Who are you? Not you personally but who do you represent? Are you a construction company (big or small? General or trade specific?) doing comparative analysis on specific projects or are you a government or industry agency (impartial government agency or industry advocacy group?) looking for an analysis for setting national policy ?
Are you looking for a country to country comparison or are you interested in different areas of each country? (major city to major city or rural isolated area to rural isolated area)
Do you simply want to say that labour efficiencies differ or that they differ because of
a) equipment utilization
b) economic factors (men with wheelbarrows vs. mechanical equipment has relatively different economies and therefore different utilization rates in the two countries)
c) labour availability or other social factors
d) construction design and methods or
e) some other factor(s)
Note: these are co dependant (equipment utilization might be dependant on economic factors and/or social factors)
Do you want to be able to identify the degree of co dependency?
How sure or your numbers do you want to be? (i.e. with a 95% or 99% or 99.9% confidence interval the comparative labour efficiency is between x and y)
All of the above will greatly influence the amount of work and the degree of analysis.
You can get a lot of US data from a company like R.S. Means who publishes comprehensive cost and labour data for the US. (
They have indexes for Canadian cities and might have some information for other countries as well. I have found this an excellent resource for estimating information.
If they do not have any South American information then you will have to get it form some other source (Ecuadorian similar type of company, direct observation, records of past construction projects, survey of the local industry, industry association data etc.)
In general your analysis will be (widgets per hour US) /(widgets per hour Ecuador)= relative efficiency in labour hours between the two countries.
If you want labour cost efficiencies (widgets per hour x labour rate US)/ (widgets per hour x labour rate Ecuador)=relative labour cost efficiency between the two countries. (pick your currency and look out for exchange rate fluctuations to change cost efficiencies)
Compounding any analysis will be the utilization of capital and equipment. I would imagine that the use of labour saving equipment would be greater in the US than Ecuador. You would have to do a comparison similar to the labour cost for equipment cost(s).
If you are looking for some global index of labour productivity then you would have to use some sort of weighted average between on all the various components in a construction project. This will get tricky as the relative weights will change between countries depending on local economies and local practices.
For example say that in the US steel is 75% and concrete is 25%. The ratio in Ecuador might be steel 25% and concrete 75%. The comparative index would therefore change depending on if you used US weights or Ecuadorian weights or local weights for each country.
There will also be a lot of variation between labour efficiencies from project to project. The best you will be able to do is state some mean with variance or a confidence interval based on a statistical analysis.
The actual analysis is easy. Its getting good input data that will be the hard part. The validity of the input data will be critical to any conclusions reached from the analysis.
Hope this helps.
Rick Kitson MBA P.Eng
Construction Project Management
From conception to completion
