The Impact Of Change Orders On Mechanical Construction Labor Efficiency

Change orders impact many areas of construction projects. However, the impacts that change orders have on labor efficiency are much harder to quantify and are, therefore, a significant risk to contractors. Little research has been completed in the past quantifying these impacts so that disputes are common between owners and contractors regarding the actual cost of change. This study uses data from 43 projects, 27 impacted by changes and 16 not impacted by changes, to develop a linear regression model that predicts the impact on labor efficiency. The input factors needed for the model are: (1) Total Actual Project Hours, (2) Total Estimated Change Hours, (3) Impact Classification, and (4) Timing of Change. Timing of Change is calculated by breaking the project schedule down into six periods (i.e., changes before construction start, 0 - 20%, 20 - 40%, 40 - 60%A, 60 - 80%, and 80 - 100%), listing the percentage of change that occurred in each period, and calculating a weighted timing factor. The model calculates the labor loss or gain in efficiency for a particular project so that owners and contractors will better understand the true change impact on labor efficiency. Significant results have been found in hypothesis testing. The results show that impacted projects have larger amounts of change, have a larger decrease in labor efficiency, and are more impacted by change that occurs later in the project schedule. These results appear to be consistent with the intuitive judgement of industry professionals. The research is limited to the mechanical trade, but does include specific work in plumbing, HVAC, process piping, and fire protection.