i SHORTAGE OF SKILLED LABOUR IN CONSTRUCTION INDUSTRY OF SRI LANKA By Basnayake L.K. (E/10/0057) Premathilaka R.P.M.M. (E/10/264) Supervised by Dr. P.B.G. Dissanayake Project: E/10/072 Department of Civil Engineering Faculty of Engineering University of Peradeniya Peradeniya, 20400 Sri Lanka August, 2015
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i
SHORTAGE OF SKILLED LABOUR IN
CONSTRUCTION INDUSTRY OF SRI LANKA
By
Basnayake L.K. (E/10/0057)
Premathilaka R.P.M.M. (E/10/264)
Supervised by
Dr. P.B.G. Dissanayake
Project: E/10/072
Department of Civil Engineering
Faculty of Engineering
University of Peradeniya
Peradeniya, 20400
Sri Lanka
August, 2015
ii
ABSTRACT
The construction industry is heavily dependent on the adequate supply of skilled labour,
and as a result the skilled labour shortage in the Sri Lanka has received considerable
attention in recent years. Hence, the study on the shortage of skilled labour in
the construction industry of Sri Lanka is an important and timely study for the industry.
This study focuses on the reasons for the skilled labour shortage, the consequences of
skilled labour shortage, mitigation methods to overcome the skills shortage and to find the
extent of the skilled labour shortage in Sri Lanka. A questionnaire survey was conducted
within the both private and public construction organizations to analyze the views of
professionals’ as well as labourers’. Professional level questionnaire survey was conducted
among 150 number key persons with in the industry and labour feedback survey was
conducted among 55 number labourers with various skills categories. Significance Index
was applied for the ranking of reasons and adverse effects while the Importance Index was
used to rank the counter measures. Spearman’s Rank Correlation method was used to find
the relationship between the responses of each category. Both the Microsoft Excel as well
as the SPSS software were utilized accordingly for the processing of data analysis. Labour
feedback survey was found seven critical issues for the skills shortage. Inadequate supply
of skilled labour from training institutes was found as the major reason for shortage of
skilled labour in construction industry while poor quality of works was identified as the
major effect and arranging seminar/training through ICTAD/IESL was found as the most
suitable mitigation measure to overcome the issue.
Keywords: Construction Industry, Skilled Labour, Causes, Effects, Mitigation Measures
iii
Acknowledgements
We would like to pay our gratitude to Dr. P.B.G. Dissanayake, the supervisor of our
project for his guidance. Also we would like to thank Dr. S.B. Wijekoon and Mrs. K.K.K.
Sylva for their advises as members of our evaluation panel. Furthermore our sincere
acknowledgement goes to Civil Engineering Department and Civil Engineering Society for
the support given to us to make our reseach a success.
iv
Contents
Abstract
Acknowledgement
Table of Contents
List of Figures
List of tables
List of Abbreviations
1 Introduction
2 Literature Review
3 Materials and Methods
4 Results and Discussion
5 Conclusion and Recommendation
References
Appendix
v
List of figures
Fig 4.1 Distribution by Employment
Fig 4.2 Distribution by Involvement
Fig 4.3 Distribution by Category
Fig 4.4 Distribution by ICTAD Grade
Fig 4.5 Summary of the training analysis
Fig 4.6 Summary of the training analysis
vi
List of tables
Table 4.1 Ranking of Casual Factors according to the view of involved parties
Table 4.2 Ranking of Casual Factors according to the view of type of employment
Table 4.3 Ranking of effects due to shortage according to the view of the type of
involvement
Table 4.4 Ranking of effects due to shortage according to the view of type of employment
Table 4.5 Ranking of Mitigation Measures to overcome the shortage
Table 4.6 Ranking of Mitigation Measures to overcome the shortage according to the view
of type of employment
Table 4.7 Summary of casual factors according to overall view
Table 4.8 Summary of effects according to overall view
Table 4.9 Summary of mitigation measures according to overall view
Table 4.10 Spearman's Rank of Correlation among involved parties
Table 4.11 Preliminary results of Questionnaire B
Table 4.12 Grand Summary Table
vii
List of abbreviation
ICTAD Institute of Construction Training and Development
IESL Institution of Engineers Sri Lanka
QS Quantity Surveyor
TO Technical Officer
1
CHAPTER ONE
INTRODUCTION
1.1 Sri Lankan Construction Industry
Construction Industry is one of the most booming industries in the 21st century and remains
so with the continuation of the development process especially in the developing countries.
In Sri Lanka, the construction industry plays a major role in economic and physical
development. Further it is the fourth highest sector in Sri Lankan economy after services,
manufacturing and agriculture (IMacs Research & Analytics , 2011). The end of the
island’s ethnic war in 2009 has revived the economic activity and resulted in an
infrastructure building boom (IMacs Research & Analytics , 2011).
According to the Annual Survey of Construction Industries, the total estimated value of
work done by all types of construction activities in Sri Lanka was Rs.78, 320 million in
2010. The highest contribution to this value has been made by the building construction
sector which accounted for 48.0 % of the total value of work done. The major share of the
value of work done on building construction sector (which amounted Rs. 37,623 million)
has come from the private and public sector. Highway construction was the second highest
contributor to the value of works done, amounting to 32.6% of the total value in 2010
(Survey of construction industries, 2011).Aided by robust construction and manufacturing
activities, the industry sector recorded a growth rate of 9.9 percent, raising its share of
GDP to 31.1percent with in the year 2013 (Central Bank of Sri Lanka Annual Report,
2013).
However, there are challenges to overcome with the construction industry of Sri Lanka.
The industry concerns include high raw-material costs, lack of availability of funds,
shortage of skilled workers and frequent changes in regulations, particularly in
development control and approval processes (IMacs Research & Analytics , 2011).
As of 2009, the direct employment in the construction industry was 562,000 persons. This
included four categories of employees: professional, technical, crafts, and machine
operators. Almost 97 percent of total persons employed were males with 75 percent falling
2
in the 25-45 age-group. 52 per cent were with experience of less than five years (IMacs
Research & Analytics, 2011).
There is an excess demand in the job categories of craft and related trade workers,
elementary occupations, and plant and machinery operators and assemblers (Karunathilake,
2006). Hence, it is clear that there is a huge shortage with the skills related to the
construction industry of Sri Lanka.
1.2 Objectives of the Study
The specific objectives of the study are as follows;
To investigate extent of the skill labour shortage in Sri Lanka.
To investigate causes for the shortage of skilled labour in construction industry of Sri
Lanka.
To find out the consequent effects due to the shortage of skilled labour.
To propose suitable mitigation methods to overcome the shortage of skilled labour.
1.2 Scope of the Study
Sri Lankan construction industry can be categorized under building construction, highway
construction, bridge construction, water supply & drainage, irrigation & land drainage,
dredging & reclamation and other constructions (Survey of construction industries, 2011).
However the scope of this study is limited only for the building construction, highway
construction works and water supply and drainage works, considering availability of time
for the study. Data were collected from both government and private sector organizations
including client, contractor and consultant, three parties.
1.3 Significance of the Study
A standard civil engineering construction project is expected to meet the requirements of
cost, time and quality of the client, which are to a significant extend rely on performance of
involved workforce. The workforce performance mainly depends on their acquired training
or skills. Though the many past researchers identified the shortage of skilled labour as a
key factor which adversely affects the construction industry in both locally as well as
3
internationally, there are only few studies done to analyze this situation to come up with
effective mitigation measures. Besides many researches have been done on building
construction industry, gender factor, social factors and labour feedback had not been
investigated. Thus, this research is an attempt to cover the short comings of the past studies
and to support the Sri Lankan economy. Therefore, the study on “shortage of skilled
labour in construction industry of Sri Lanka” is a very timely and unavoidable research
topic to the present context of Sri Lanka.
4
CHAPTER TWO
LITERATURE REVIEW
2.1 Nayanthara De Silva, Rajakaruna R. W. D. W. C. A. B., and Bandara K. A. T. N.
“Challenges faced by the construction industry in Sri Lanka: perspective of clients
and contractors”
This paper presented about findings of a research which was carried out to identify
challenges face by the Sri Lankan construction industry and effective motives to overcome
such aspects. The survey sample was selected randomly and the sample size was 40. An
industry wide questionnaire was developed. A seven-point “likert” scale was used to record
the response of respondents. The questionnaire survey was started from a pilot survey. The
improved version of the questionnaire was distributed among the selected group. Hand
delivery was used to deliver and collect the questionnaires to increase the rate of return.
2.2 Jayawardena. H.K., Senevirathne. K. and Jayasena. H.S. “Skilled Workforce in
Sri Lankan Construction Industry: Production vs. Acceptance”
This research was undertaken to unearth the answer to the research question of “how the
skilled labour production could gain acceptance in the Sri Lankan construction industry”.
Desk research was carried out to find training courses available for the construction trades.
A questionnaire survey was conducted among 77 recruitment officers in medium to large
size contracting firms and 34 subcontractors - in six distinct trades.
2.3 Jayawardana .A.K.W. and Gunawardana. N.D. “labour market issues of
Managerial and Supervisory personnel in the construction industry” (A case study in
Sri Lanka)
In this study two types of questionnaire were used for their survey and data collection as
Institutional Questionnaire among contractors, consultants and clients and Individual
Questionnaire survey among administrators, managers, professionals, technicians and
supervisors. Survey sample was comprised with 107 contractors listed in ICTAD.A postal
questionnaire was used and paid envelops were attached with the questionnaire. The
5
response rate was 40%. In this research data processing was carried out manually as well as
using the computer software such as excel spread sheet package.
2.4 Praveen.R, Niththiyananthan.T, Kanarajan.S “Understanding and Mitigating the
Effects of Shortage of Skilled Labour in the Construction Industry of Sri Lanka”
The objectives of this study were to identify the causes for the shortage of skilled labour in
the Sri Lankan construction industry, the resulting effects due to the shortage and to come
up with effective mitigation measures. In this research the “Significance Index” was used
to rank causes and effects and the “Importance Index” was used to find the important
mitigation measures. Agreements between different parties were compared using
Spearman’s rank correlation coefficient method. This study revealed that the most
significant causal factor for skilled labour shortage is “inadequate number of trained
personne” and resulting effect is “time over-run” of construction project. This study also
revealed that “Increasing the wages” as the most important mitigation measure to
overcome this problem.
2.5 Samarakoon. S.M.S. “Causes and effects in medium scale building construction in
Sri Lanka”
In this research, a questionnaire survey was used among the construction industry in Sri
Lanka. The related factors were identified using the findings of previous researches and
interviewing the professionals working in medium scale building projects. A pilot survey
was carried out among 10 professionals working in related field. The sample was selected
according to snowball sampling method. The questionnaire was distributed using email,
hand and post.
2.6 MacKenzie.S , Kilpatrick. A. R. & Akintoye. A “UK construction skills shortage
response strategies and an analysis of industry perceptions”
This paper reveals that the construction industry is heavily dependent on the adequate
supply of a skilled labour force. The perception of the construction industry to the skills
shortage response strategies identified was investigated through a one-page postal
6
questionnaire survey sent to 130 construction organizations. The response rate was
considered high compared with the norm of 20–30% for most postal questionnaire survey.
The respondents were asked to rank responses on a 6-point Likert scale. Additionally, they
were asked to indicate the order of preference for their response, and to rank their preferred
solutions for the industry. Finally it concludes as follows. “For long term training plans to
be successful the industry must ensure that there is an adequate supply of people entering
and encouraged to remain in the industry.”
2.7 Sadi A. Assaf , Sadiq Al-Hejji “Causes of delay in large construction projects”
A survey on time performance of different types of construction projects in Saudi Arabia
was conducted to determine the causes of delay and their importance according to each of
the project participants, i.e., the owner, consultant and the contractor. The field survey
conducted included 23 contractors, 19 consultants, and 15 owners.
Data were gathered through a questionnaire.
Frequency index: A formula is used to rank causes of delay based on frequency of
occurrence as identified by the participants
Frequency Index (F.I.) %= a(n/N)* 100/4
Where; a is the constant expressing weighting given to each response (ranges from 1 for
rarely up to 4 for always), n is the frequency of the responses, and N is total number of
responses.
Severity index: A formula is used to rank causes of delay based on severity as indicated by
the participants.
Severity Index (S.I.)= a(n/N)*100/4
where a is the constant expressing weighting given to each response (ranges from I for
little up to 4 for severe), n is the frequency of the responses, and N is total number of
responses.
Importance index: The importance index of each cause is calculated as a function of both
frequency and severity indices, as follows:
Importance Index (IMP.I.)%= (F.I.% * S.I %)/100
The Spearman’s rank correlation coefficient r is used to measure and compare the
association between the rankings of two parties for a single cause of delay, while ignoring
the ranking of the third party.
7
CHAPTER THREE
MATERIALS AND METHODS
3.1 Survey Method –Questionnaire Survey
From the Literature Review a methodology was adopted for the study on “Shortage of
Skilled Labour in Construction Industry of Sri Lanka”. The methodology of collecting
data and analyzing them are discussed below.
Questionnaire survey was the main method of collecting data. Two types of
questionnaires were prepared, one targeting administrative and professional level such as
managers, engineers, architects and quantity surveyors. This questionnaire was
a quantitative one which was filled by them. Most of the questionnaires were sent by post
while email and manual methods (by hand) were also used whenever it wass appropriate.
The other questionnaire was a qualitative questionnaire targeting the labour. Unlike the
previous questionnaire this questionnaire was filled by ourselves i n most cases after
having face to face interviews with the labourers.
A sample size of 75 was selected (in the previous studies this figure is between 25 and
147) and a response rate of 40% is expected which is the average response rate of
previous studies. Altogether 150 questionnaires were sent. Both the snowball sampling
and the random sampling methods were adopted in selecting the sample size. For the
questionnaire survey the contact details of the relevant personnel were obtained from the
professional bodies like IESL, Institution of Architects and Institution of Quantity
Surveyors etc.
A pilot survey was conducted before sending the final questionnaire targeting 10 key
persons from the industry in order to get their feedback to fine tune the
questionnaire. A questionnaire feedback form was attached to get their feedback. The
questionnaires were prepared covering the following aspects and key areas in order to get
a clear response and to make the analysis easier and more effective.
Questionnaire A-Targeting Administration and Professionals
Background Information
Information about the organization
Information about the respondent
8
02. Identification of the reasons for a shortage of skilled labour
03. Identification of the consequences of the shortage of skilled labour
04. Determination of mitigation measures
05. Conclusion.
Questionnaire B- Targeting Labours
01. Basic personal details
02. Type of job and work experience
03. Job satisfaction
04. Training and educational qualifications
05. Physiological aspects of the job
06. Future Plans with the job
In order to obtain a high response rate confidentiality was kept at its maximum and was
avoided asking for private details. A covering letter was attached with the questionnaires
in order to give an idea on the nature of the project expecting a high response rate.
3.2 Analytical Method
In order to calculate the severity and the importance of the consequences of the shortage
of skilled labour Importance Index and Severity Index were calculated. Relative
Importance Index were calculated from the above two indices in order to rank the causes
and the effects.
In order to calculate the frequency of occurrence of certain events, frequency index was
calculated. Importance Index was calculated to rank the importance of mitigation
measures.
The statistical methods adopted to analyze the data are as follows.
3.2.1 Frequency Index
Frequency Index was used to determine the frequency of occurrence of a certain event.
Frequency of Occurrence
1-Rarely
2-Sometimes
9
3-Often
4-Always
Frequency index = a (n/N)*100/4
a-constant for weight given by each respondent
n-frequency of occurrence
N-Total number of response
3.2.2 Severity Index
Severity Index was used to rank the factors according to the severity.
Degree of Severity
1-Little
2-Moderate
3-Great
4-Extreme
Severity index= a (n/N)*100/4
a-constant for weight given by each respondent
n-frequency of occurrence
N-Total number of response
3.2.3 Relative Importance Index
This index was used to rank the factors in ascending order.
Relative Importance Index (RII) = (FIxSI)/100
3.2.4 Spearman’s Rank Correlation
Spearman Rank Correlation was used to determine whether there is any correlation
between two factors.
di = xi-yi (Difference between the ranks)
n-size of the sample
3.2.5 SPSS (Statistical Package for the Social Sciences)
This is a software package developed to analyze the data of social surveys. This software
was used to find correlations among certain factors.
= 1 −6𝑑𝑖^2
𝑛(𝑛2 − 1)
10
CHAPTER FOUR
RESULTS AND DISCUSSION
4.1 Results of Questionnaire A
4.1.1 General Characteristics of Respondents
Two questionnaire surveys were conducted, first one targeting the Engineers, Architects,
QSs and TOs and the second one targeting skilled labour.
4.1.2 Respondents of Questionnaire Survey 1
150 questionnaires of the first type were sent among professional engineers, architects, QS
and TOs out of which 71 responds were obtained with a respond percentage of 48%. The
distribution of the respondents by type of employment, involvement, category and ICTAD
classification are as follows.
Fig.4.1 Distribution by Employment Fig.4.2 Distribution by Involvement
11
4.2 Findings of Questionnaire Survey-01
4.2.1Ranking of Casual Factors Causing a Shortage of Skilled Labour
Frequency Index and Severity Index were calculated for each and every factor mentioned
in the questionnaire. By multiplying both these indices Relative Important Index was
calculated. Based on Relative Important Index casual factors were ranked and the
summarized results of each category are tabulated as follows.
Table 4.1. Ranking of Casual Factors according to the view of involved parties
No
.
Casual Factors Client Consultant Contractor
RII Ran
k
RII Ran
k
RII Rank
1 Inadequate supply of skilled labour
from training institutes
54.81 4 52.07 1 62.3
9
2
2 Inadequacy of skills in the available
labour force
60.65 2 38.20 4.5 63.1
1
1
3 People's unwillingness to engage in
construction industry as labours
47.60 6 38.20 4.5 33.6
7
6
4 Management policy of the
organizations (Can manage with lesser
no. of skilled labours and a higher no.
skilled labour)
40.24 7 29.05 7 28.6
7
7
5 After training shifting their careers to
another field
50.30 5 36.27 6 38.9
9
5
6 Contractors do not provide training for
employees
57.69 3 39.77 3 49.0
8
4
7 Seeking foreign employment with
higher salary
71.56 1 44.90 2 49.1
1
3
Fig.4.3 Distribution by Category Fig.4.4 Distribution by ICTAD Grade
12
Table 4.1. Ranking of Casual Factors according to the view of type of employment
No
. Casual Factors
Engineer Architect QS TO
RII Rank RII Rank RII Rank RII Rank
1 Inadequate supply of skilled
labour from training institutes 48.66 1 87.89 1 56.25 3 57.95 3
2 Inadequacy of skills in the
available labour force 43.16 4 66.02 2 76.53 1 64.46 1
3
People's unwillingness to
engage in construction
industry as labourers
33.40 6 35.16 5.5 48.21 6 43.39 4
4
Management policy of the
organizations (Can manage
with lesser no. of skilled
labours and a higher no.
skilled labour)
30.83 7 14.06 7 34.69 7 35.95 6
5 After training shifting their
careers to another field 35.85 5 35.16 5.5 50.89 5 33.26 7
6 Contractors do not provide
training for employees 43.54 3 56.25 3.5 61.73 2 42.98 5