3 Ways a Labor Management Software Improves Profitability

April 16th, 2021

Labor costs can drive profitability down more than any other factor when running a construction company. You’re already taking the time to manage material and production costs, but are you doing enough to control labor?

Even if you’re having contractors “clock in” by writing down their times on a sheet or punching in on an old fashioned time clock, that is not enough, you have to have the right workforce management software.

A labor management software (LMS) with GPS capabilities is the only way to get accurate data about labor costs and a more meaningful way to drive those costs down and drive profitability up.

Labor Management Software Eliminates Imperfect Time Keeping

Using an imperfect time system leads to bad record-keeping. For instance, if a contractor writes down they arrived at 8:00 am according to their watch, but company time says it is 8:10 am, you just paid for 10 minutes of unused time. While that doesn’t seem like much, having 30 contractors all claiming those extra ten minutes ends up being 5 hours of paid time daily that you’re not getting any productivity out of. With an LMS, the contractor clocks in and the time is standard across the entire company. You will never have to worry about paying for unused time again. That's the power of a quality workforce management systems

Labor Management Software Eliminates Falsifying Data

Keeping up with dozens of contractors is difficult if you’re not on-site at all times. With a GPS-enabled LMS, you no longer have to worry about paying contractors for work not being done. If a contractor leaves the site, you will be notified immediately. When contractors go on lunch break they clock out on the LMS and clock back in when they return. A contractor cannot falsify their time when it is accurately tracked.

Labor Management Software Allows For Accurate Data Collection

Having an LMS allows you to see exactly where and how labor dollars are being spent on each job. You also have the ability to pull up your labor as a raw number and use it to calculate how much you’re spending as a percentage of overhead. Seeing these numbers, you’ll be able to adjust how many contractors are used and how many labor hours are allowed. This can shave 5-10% off of your overhead, leading to better profits.

Having a LMS will:

  • Eliminate imperfect timekeeping

  • Eliminate falsified data

  • Keep your data accurate and functional