Construction Survey Workshop

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Construction Survey Workshop
Asian Development Bank Manila, Philippines Novembe
r 28-30, 2005
Yonas Biru,
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Objectives

• The objective is to get national average
  prices/cost for the basic expenditure headings of
  the construction sector
• Residential buildings, Non-residential
  Construction and Civil Engineering Works.
• What is required from countries are data that
  will permit estimates of parities for each of
  these basic headings.
• The data required from each country are estimates
  of the cost of a number of Construction
  Components that have been identified as common in
  systems and projects across the region

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Objective
Our objective is to compare the cost of common
structures
Not to compare the cost of unique structures
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General challenges

• Construction Projects are much more complex to
  price
• The characteristics of construction projects are
  highly variable
• Difficult to obtain perfect matches across
  countries
• Most statistical agencies do not have the
  expertise required to carryout construction
  surveys

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Specific challenges

• What data to collect?
• Who collects the required data?
• Where and when to collect the data?
• How many observations?

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What data are collected?

• Each Construction Component to be priced has
  been described in the form of an SPD/PS
• A typical construction component contains 3
  subcomponents
• Building materials
• Equipment
• Labor- skilled and unskilled

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Who collects the data?

• Building engineers, architects, quantity
  surveyors or other experts have to be involved
• Most statistical agencies do not have the
  necessary expertise
• Some countries may be able get the help of
  specialists from public works departments
• Other government agencies responsible for
  building regulations may also be useful
• In other countries the work has to be contracted
  out to construction firms or freelance engineers

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When and where data are collected

• In principle the prices should be national annual
  average
• This means data collection should be across
  regions and should cover all year (quarterly),
  but this would be excessively costly
• In practice some simplifications are necessary
  for construction sector
• Prices should only be collected in 3 to 5 cities
  that would give a close approximation to national
  average
• In smaller countries this may not be a major
  issue. In large countries the scope of coverage
  should be extended to cover major cities and
  regions.
• Price collection in mid-year is recommended.

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How many observations?

• For building materials and for equipment multiple
  pricing is recommended (Min. 15 observations)
• Ideally, prices should be collected from at least
  four or five sources (public work departments,
  contractors, other construction experts, etc)
  again with the objective of providing an
  approximation of national average
• This may not be a major issue in relatively small
  countries with low price variations. In large
  countries the scope of coverage should be
  extended to cover major cities and regions
• For skilled and unskilled labor the number of
  observations required depends on the data sources
  used

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What is in the cost estimate?

• For the completed components the price is the
  total of the cost, at contractor prices of the
  materials, labor and equipment
• The price reported for completed components does
  not include any profit margin or any fees for
  architects, quantity surveyors and other
  construction specialists
• The purchaser prices of the materials and hire of
  equipment includes only non-deductible product
  taxes
• Value added taxes are often fully deductible for
  goods and services that are considered to be
  investments and so will usually be excluded from
  the purchaser price.

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What is in the cost estimate?

• For skilled and unskilled labor, total
  compensation of employees is to be reported and
  not just cash wages and salaries
• For equipment, building materials, and for
  off-the-shelf components the contractor prices
  are to be reported