Replies

1. 
   JerraldHayes | Nov 28, 2002 04:35am | #1

   MTCARPENTER I not so sure about where to get the "real" economical

   data you might be looking for but if you are looking for opinions on the merits

   of employees vs sub everything out you might want to go an post your question

   over on in the Journal

   of Light Construction Business Strategies Forum. The crowd over there is

   decidedly pro-subing everything out whereas I think the general sentiment here

   is more pro-employee.

   I am sure I have some information somewhere that might help you out so since

   it's the start of a long weekend (at least for me it is) I'll give a look around

   my office to see what I can dig up for you too. While I can't think of anything

   specifically that refers to what you are interested in you should check out

   Harvard

   University's Joint Center for Housing Studies and see what the documents

   and studies that they have conducted might say. Regardless of if you find what

   your looking for there I am sure that what you'll learn from reading their stuff

   will help your general knowledge of the business.

   My own opinion is that in the long run economically speaking they are both

   the same. I be back this weekend to elaborate on why I feel that way but just

   me saying that might be enough to spark some debate on that issue here. Personally

   I'm pretty pro-employee for reasons that aren't necessarily economic but I am

   not nearly as pro-employee/anti-sub as some of the people that I know of here.

   ---

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1. 
   mtcarpenter | Nov 29, 2002 10:15pm | #5

   Thanks for your comments on the topic of subs vs employees.  I will look into both JLC and Joint Center for Housing Studies.  I am also finding that subs may be more econmical, but employees can also be beneficial. 

2. 
   BobKovacs | Nov 28, 2002 05:51am | #2

   MT-

   Like Jerrald, I doubt you'll find much published info on the topic.  However (and I could elaborate on this for hours), at least from an economic standpoint, the sub route will probably be more cost effective.

   Some would argue that you can hire a carpenter, and pay his wages and benefits for less than what you'd pay a sub for that same carpenter (he's got to make a profit).  However, unless you have enough work to keep the carpenter busy building houses all the time, you'll start losing due to unproductive manhours.  Take that same situation and multiply it twenty-fold to have a mason, a drywall hanger, a taper, a painter, a plumber, etc., etc., on your payroll, and you can imagine the number of homes you'd have to be building to keep them all busy.  Not to mention the scheduling nightmare, the payroll and accounting costs, and all the hiring and firing you'd have to do.  All of this adds indiret work costs to the overall project budget.

   Don't get me wrong- there are plenty of companies out there that self-peform part of the work (most commonly framing), and the lead carpenter supervises the rest of the trades.  But you'd be hard pressed to find a company that self-performs all of the work.  If it was more cost effective to do so, the big builders of the world (Centex, US Homes, Pulte, etc.) would all be doing it.  Instead, most of them sub 100% of the work and have supers on site who each manage anywhere from 5-50 homes at a time.

   BTW- it's good to see a construction management student with an interest in residential construction.  When I got my BS from NJIT, I was the only one who had any interest in it- everyone else wanted to build office towers and bridges.

   Best of luck.  Let me know if I can help further,

   Bob Kovacs

1. 
   mtcarpenter | Nov 29, 2002 10:18pm | #6

   thanks to your reply.  I too am finding most students going into this field are also choosing sky scrapers vs. residental homes.  The hard thing with the program here in Montana is that they really gear you towards large commerical jobs outside of the state.  Of course typically larger cities.  Not really what I'm interested in. 

   thanks again

1. 
   BobKovacs | Nov 30, 2002 01:08am | #7

   You're on the right track though from what I can see.  I did the same thing you're doing- every chance I got for a project, paper, etc., I geared it toward residential instead of commercial.  In the meantime, learn as much as you can about the business end of things- though most of those courses are geared toward the bigger jobs, they'll give you a leg up on the majority of residential contractors (no offense guys....).  You never know where you'll end up anyway- when residential dried up here in NJ in the early 90's, I found myself on $5-10 million commercial jobs.  Great experience- really added to my resume.

   Best of luck,

   Bob

3. 
   jimblodgett | Nov 28, 2002 06:14pm | #3

   "...cost difference..."

   Don't forget to consider the cost of superior/inferior craftsmanship.  When you sub parts of any job, the G.C. and the sub immediately are working to different ends.  The sub tries to satisfy the G.C. and still maximze her proffits.  The G.C. tries to get the most he can for what he's paying.  Same basic adversarial relationship exists with any bid situation.

   Now compare that to an employee who wants to keep her job as a carpenter.  The same G.C. can encourage that employee to work to higher standards, closer tollerances, stretch their artistc abilities, think ahead making things easier for everyone else on the job, because he's paying her by the hour, in essence renting her labor.

   Would that make a difference in the quality of buildings?  Is there a long term cost to society when we slap up buildings as fast and as cheaply as we can?

   Brinkmann for president in '04

   
   

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   Edited 11/28/2002 10:16:58 AM ET by jim blodgett

4. 
   fredsmart48 | Nov 28, 2002 07:24pm | #4

   Money tied up in equipment that is not going to get use more then a few times a year. Is why very few companies do it all from start to finish. That is why GC builders sub it out.