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Cost-Benefit Analysis of a Four 10-hour Day Work Week in Construction

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Title: Cost-Benefit Analysis of a Four 10-hour Day Work Week in Construction
Physical Description: 1 online resource (35 p.)
Language: english
Creator: Berman, Drew
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2009

Subjects

Subjects / Keywords: compressed, productivity, schedule, workweek
Building Construction -- Dissertations, Academic -- UF
Genre: Building Construction thesis, M.S.B.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: The U.S. construction sector has been impacted by the current economic slowdown. In an effort to reduce costs while maintaining productivity levels alternative work schedules may be one potential solution. Alternative work schedules vary, but compressed work week schedules and specifically four ten-hour day work week schedules (also known as 4/40 work schedules), are the focus of this study. To determine whether a 4/40 work schedule would reduce costs and maintain current productivity levels, a study of non-construction sectors utilizing 4/40 work schedules was completed. The effect that 4/40 work schedules have, the benefits or problems thereof, and the reasons behind their initial implementation were data collected for this analysis. This study addressed the feasibility of 4/40 work schedules in the construction sector. Additionally, it addressed the costs and benefits associated with the implementation of 4/40 work schedules in the construction sector. The researcher determined that 4/40 work schedules would be both feasible and cost beneficial for small, specialized or trade specific construction firms.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Drew Berman.
Thesis: Thesis (M.S.B.C.)--University of Florida, 2009.
Local: Adviser: Issa, R. Raymond.
Electronic Access: RESTRICTED TO UF STUDENTS, STAFF, FACULTY, AND ON-CAMPUS USE UNTIL 2009-11-30

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2009
System ID: UFE0024436:00001

Permanent Link: http://ufdc.ufl.edu/UFE0024436/00001

Material Information

Title: Cost-Benefit Analysis of a Four 10-hour Day Work Week in Construction
Physical Description: 1 online resource (35 p.)
Language: english
Creator: Berman, Drew
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2009

Subjects

Subjects / Keywords: compressed, productivity, schedule, workweek
Building Construction -- Dissertations, Academic -- UF
Genre: Building Construction thesis, M.S.B.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: The U.S. construction sector has been impacted by the current economic slowdown. In an effort to reduce costs while maintaining productivity levels alternative work schedules may be one potential solution. Alternative work schedules vary, but compressed work week schedules and specifically four ten-hour day work week schedules (also known as 4/40 work schedules), are the focus of this study. To determine whether a 4/40 work schedule would reduce costs and maintain current productivity levels, a study of non-construction sectors utilizing 4/40 work schedules was completed. The effect that 4/40 work schedules have, the benefits or problems thereof, and the reasons behind their initial implementation were data collected for this analysis. This study addressed the feasibility of 4/40 work schedules in the construction sector. Additionally, it addressed the costs and benefits associated with the implementation of 4/40 work schedules in the construction sector. The researcher determined that 4/40 work schedules would be both feasible and cost beneficial for small, specialized or trade specific construction firms.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Drew Berman.
Thesis: Thesis (M.S.B.C.)--University of Florida, 2009.
Local: Adviser: Issa, R. Raymond.
Electronic Access: RESTRICTED TO UF STUDENTS, STAFF, FACULTY, AND ON-CAMPUS USE UNTIL 2009-11-30

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2009
System ID: UFE0024436:00001


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1 COST -BENEFIT ANALYSIS OF A FOUR 10 HOUR DAY WORK WEEK IN CONSTRUCTION By DREW BERMAN A THESIS P RESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN BUILDING CONSTRUCTION UNIVERSITY OF FLORIDA 2009

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2 2009 Drew Berman

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3 To Susan, Richard, Troy and Jennifer and in memory of Brad I. Berman

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4 ACKNOWLEDGMENTS I thank the chair and members of my supervisory committee for their mentoring, the staff at the UF Architecture Library for their research assistance; and the interviewees for their time and participation. I thank my parents for their continual encouragement and motivation regarding the pursuit of this academic achievement

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5 TABLE OF CONTENTS page ACKNOWLEDGMENTS .................................................................................................................... 4 LIST OF TABLES ................................................................................................................................ 7 LIST OF FIGURES .............................................................................................................................. 8 ABSTRACT .......................................................................................................................................... 9 CHAPTER 1 INTRODUCTION ....................................................................................................................... 10 2 LITERATURE REVIEW ........................................................................................................... 11 Introduction ................................................................................................................................. 11 Four Day Workweeks in The 1970s .......................................................................................... 11 Public Sector Implementation .................................................................................................... 12 Private Sector Implementation ................................................................................................... 14 Other Types of Alternative Schedules ....................................................................................... 15 Productivity ................................................................................................................................. 16 Work Life Balance and Employee Morale ................................................................................ 17 Construction Ties ........................................................................................................................ 19 Summary ...................................................................................................................................... 19 3 METHODOLOGY ...................................................................................................................... 21 Introduction ................................................................................................................................. 21 Steps Taken .................................................................................................................................. 21 4 INTERVIEWS ............................................................................................................................. 22 Introduction ................................................................................................................................. 22 Public Labor Representative Interview ...................................................................................... 22 Private Firm Representative Interview ...................................................................................... 23 5 ANALYSIS OF RESULTS ........................................................................................................ 24 Productivity Loss ......................................................................................................................... 24 Cost Benefit Formulas ................................................................................................................ 24 Example Case Studies ................................................................................................................. 25 Benefits Sum mary ....................................................................................................................... 27

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6 6 CONCLUSIONS AND RECOMMENDATIONS ................................................................... 31 Conclusions ................................................................................................................................. 31 Recommendations ....................................................................................................................... 31 REFERENCES ................................................................................................................................... 33 BIOGRAPHICAL SKETCH ............................................................................................................. 35

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7 LIST OF TABLES Table page 5 1 Example case study #1 ........................................................................................................... 27 5 2 Example c ase study #2 ........................................................................................................... 28 5 3 Example case study #3 ........................................................................................................... 29 5 4 4/40 Benefits by group ........................................................................................................... 30

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8 LIST OF FIGURES Figure page 2 1 Productivity loss as a function of work days per week and work hours per day ............... 20 5 1 Productivity loss as a function of work days per week and work hours per day with projections for 4 days per week ............................................................................................. 29

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9 Abstract of Thesis Presented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Master of Science in Building Construction COST -BENEFIT ANALYSIS OF A FOUR 10 HOUR DAY WORK WEEK IN CONSTRUCTION By Drew Berman May 2009 Chair: R. Raymond Issa Major: Building Construction The U.S. construction sector ha s been impacted by the current economic slowdown. In an effort to reduce costs while maintaining productivity levels alternative work schedules may be one potential solution. Alternative work schedules vary, but compressed work week schedules and specifi cally four ten -hour day work week schedules (also known as 4/40 work schedules), are the focus of this study. To determine whether a 4/40 work schedule would reduce costs and maintain current productivity levels, a study of non -construction sectors utiliz ing 4/40 work schedules was completed. The effect that 4/40 work schedules have, the benefits or problems thereof, and the reasons behind their initial implementation were data collected for this analysis. This study addressed the feasibility of 4/40 work schedules in the construction sector. Additionally, it addressed the costs and benefits associated with the implementation of 4/40 work schedules in the construction sector. The re sults of the study indicated that 4/40 work schedules would be both feasi ble and cost beneficial for small, specialized or trade specific construction firms.

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10 CHAPTER 1 INTRODUCTION Productivity can be defined as a measure of output from production processes per unit of input. Specifically, labor productivity can be measured by output per labor -hour of input. For profit businesses under ideal conditions operate in a manner that maximizes the output pe r labor hour of input. In order to gain a competitive advantage, industry is constantly adjusting methods of operation to achieve ideal conditions and therefore an improvement in productivity. This, along with other factors such as reduction in hours per week or work -life balance programs, is why alternative work schedules were first introduced. Alternative work schedules vary, but compressed work week schedules and specifically four ten -hour day work week schedules (also known as 4/40 work schedules), a re the focus of this study. The U.S. construction industry has been impacted by the current economic slowdown. The 4/40 work schedule is one potential option, in an effort to reduce costs while maintaining productivity levels. To determine if a 4/40 wo rk schedule would reduce costs and maintain current productivity levels, a study of non-construction sectors utilizing 4/40 work schedules would be prudent. The effect that 4/40 work schedules have, the benefits or problems associated with them, and the r easons behind their initial implementation are all data needed to complete a thorough analysis. This study will address the feasibility of 4/40 work schedules in the construction sector. Additionally, it will address the costs and benefits associated with the implementation of 4/40 work schedules in the construction sector. The benefits examined will be both quantitative and qualitative.

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11 CHAPTER 2 LITERATURE REVIEW Introduction This review encom passes literature from the past three decades. Topics rela ted to 4/40 work schedules were assessed. It is important to note that the majority of the reviewed publications were current (within the last year or two) and several were in the 25 30 year old range. This is significant because the current works genera lly focus on 4 day workweeks for their environmental, social, and producti vity benefits. The works dated 10 -15 years ago focused on use of the 4 day workweek primarily as a response to the economic downturn of the time, and this tactic was used to reduce the total work being done with lesser impacts on the amount of workers doing the work (or the unemployment rate). While these same reasons may be applicable to the present US economy, from a more global standpoint the 4 day workweek has been looked at fo r its numerous other benefits. The topics included in the review were: 4/40 implementation in the late 1970s, public industry implementation, private industry implementation, alternative work schedules, and productivity and work life balance. Four -Day Wor kweeks in The 1970s Hartman and Weaver (1977) state that it is only since 1970 that the current rapid increase in the interest within both the public and private sectors toward the idea of a shortened workweek has emerged. The reasons for this rapid i n crease include potential improvements in employee productivity, job satisfaction and recruitment as well as potential reductions in absenteeism, turnover and labor costs. While there have been a wide variety of four -day plans, the most common has been four 10-hour days totaling the usual forty -hour workweek (4/40) (Fottler 1977). From 1969 to 1974, two notable four -day workweek indirect studies were conducted by the American Management Association and the American Society for Personal

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12 Administration and the Bureau of National Affairs. In these indirect studies the data collected was based on the opinions of management personnel regarding the four day workweek (Calvasina and Boxx 1975). Due to the subjective nature of the prior indirect studies, resear chers conducted several direct studies on the implementation of 4/40 work schedules. One direct study conducted tracked productivity indexes, variability in performance, and the effect of personal characteristics on performance. Personal characteristics included age, marital status, number of dependants and education level achieved. The populations studied were employees of two clothing manufacturing factories owned by the same firm but in different geographic locations. Six months of traditional five d ay work weeks were observed prior to the implementation and observation of six months of four -day work weeks of the same population. From the results of this study, change from a five -day to a four day workweek did not materially affect employees produc tivit y. Variability in performance and worker patterns similarly were unchanged (Calvasina and Boxx 1975). It needs to be noted that while productivity of labor alone was not affected by change in work schedule, significant start up and shutdown t ime periods could increase the productivity of four day workweeks when compared to five -day workweeks (Calvasina and Boxx 1975). Public Sector Implementation [Alternative work schedules] are becoming much more broadly accepted in both the public and pr ivate sectors. This is significant because government is subject to greater procedural standards. When any kind of movement takes place, it takes a while for it to first become significant and then to become part of formal procedure (Newman 1989). In J une of 2008, the state of Utah became the first state in the United States to adopt a four day workweek. The Working 4 Utah initiative announced by Governor Jon Huntsman was a direct response to

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13 soaring energy costs. State government service hours were e xtended to 7 a.m. to 6 p.m. Monday through Thursday and offices were closed on Fridays (Marquez 2008). Governor Huntsman said that by keeping most state workers home every Friday, the state will save an estimated three million dollars on utility bills a y ear (Governing Magazine 2008). The practice [of working 4/40 work schedules] mirrors what happened in the 1970s during the Carter administration another period when hard economic times resulted in energy conservation measures such as shorter weeks (Kad aba 2008). Other public institutions have implemented similar cost -saving schedules. Brevard Community College in Cocoa, Florida, went to four day work weeks for the 2007 summer session and saved $268,000 in energy costs. Additionally, sick leave fell by 50% and turnover among the 1,500-person staff dropped by 44% (Holland, 2007/8). Many federal workplaces have included a host of benefits, including flexible work arrangements (Dalphonse et al. 2007). In an article titled Great Places to Work, the autho rs found that The US Nuclear Regulatory Commission ranked number one for work/life balance (Dalphonse et al. 2007). This was due, in part, to the use of alternative work schedules by the commission. The Kansas Department of Administration tried a pilot four -day work week [in 2007] in response to rising gas prices. Numerous employees took advantage of it, but because the state has to keep running five days a week, it wasnt for everyone (Topeka Capital Journal 2008). Similar results were not experience d in all public organizations. In 2004, Spanish Fork City, Utah, began offering 4/40 work schedules to most city employees. In 2008, a Brigham Young University study was conducted on the employees working the 4/40 schedule. The study found that more th an 60% of the employees reported

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14 higher levels of productivity and that citizen access improved as a result of the 4/40 work schedule (Gehrke 2008). A recent case study document ed a three -day compressed work week implemented by the Bexar County Sheriff's De partment, Patrol Division in its effort to increase patrol coverage during periods of peak activity with limited resources. (3) Seven-day (24 hour) patrol coverage under this plan was attained by four shifts each working 13 hours and 20 minutes a day. Each patrol officer works three days on duty followed by four days off duty (Gilbert 1997). The results of the study included commonly cited advantages of the compressed work schedule are improvement in work output, employee morale, customer and empl oyee relations, and easier recruitment, as well as, corresponding reductions in absenteeism, turnover, tardiness, overtime, and operating expenses. The advantages reportedly outweigh any disadvantages. Workers, for example, cite the larger block of usable leisure time, less commuting time, and greater opportunities for secondary employment as the most positive attributes (Gilbert 1997). Private Sector Implementation In addition to all the public entities that have switched to 4/40 work schedules, the 4/4 0 work schedule has also been implemented in various private organizations. Caterpillar was among firms to move to a compressed workweek. Bosses at Caterpillar gave shop floor w orkers the option of voting for a shorter week. Almost nine in 10 of the 566 employees voted for reduced hours, which will see them working longer shifts in a four -day week (Griffin 2008). Amoore Group, a Pennsylvania health and welfare to -work consulting firm, has had employees working 4/40 work schedules since May 2008. The chief executive officer, Renee Amoore, said fewer people are calling in sick, fewer are taking a personal day, and employees are feeling refreshed in spite of the 10 -hour days (Kadaba 2008). A nationwide survey

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15 conducted by the New York -bas ed human resources consultant, Mercer, found that of 303 companies, were offering a four day option for the first time (Kadaba 2008). Private firms have looked into 4/40 work schedules for other reasons, too. Recent escalation of fuel costs has led to difficulty recruiting new employees who might not live in the immediate surrounding area of a firm. One such firm is North Shore -Long Island Jewish Health System a regional network of 13 hospitals with 38,000 employees. Employees of the firm tend to come from within a 25 -mile radius and 80% of the employees drive to work because of the impracticality of the Long Island public transportation system. [The firm] had trouble filling jobs for housekeepers, nursing attendants and others because they had to come from far away and it cost too much (Kiger 2008). North Shore -Long Island Jewish Health System expanded the compressed workweek option that it already offer ed to nurses as a recruiting inducement, offering the schedule to physical therapists, respiratory therapists and operating room technicians (Kiger 2008). North Shore is not the only firm using the compressed workweek as a benefit, either. Fortunes 2006 list of Americas 100 best companies to work for lists flexible work policies as a common attribute among the winners. Only 25 firms on the list in 1999 offered compressed workweeks, such as four 10 -hour days with Fridays off. Today, 81 companies do. S uch benefits do make a difference (Frauenheim 2006). Other Types of Alternative Schedules According to Robert A. Lussier, director of training and development at Springfield College one of the two driving forces behind the popularity of compressed workweeks is more flexible work schedules for employees (Sunoo 1996). The most popular compressed workweek utilized is the 4/40 work schedule. Another option is the Monday through Thurs day nine hour day with an eight -hour day Friday; half the employees work every other Friday. There also is the

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16 four days on, three -days off approach [with rotating schedules] (Sunoo 1996). In some cases, though, a company may allow employees to work nine hours Monday through Thursday and then take off after four hours on Friday. In a St. Louis architecture firm, for instance, employees work daily from 7:30 a.m. to 5:30 p.m. putting in 81 hours in nine days. On alternating Fridays, the company shuts down while a skeleton crew of five or six, who will get the following Friday off, holds down the fort (Fenn 1995). The owner of the firm also reported a significant reduction in the amount of sick time taken by employees as well as an increase in productiv ity (Fenn 1995). Flextime is another type of alternative schedule. Flextime allows workers to adjust their hours according to their needs, giving them more control over their lives (Newman 1989). Newman discussed the benefits and challenges with managi ng employees in a flextime environment. Employees are given more responsibility and typically improve performance as a direct result. There is no longer such a thing as being late for work; if employees show up later, they are obligated to stay later. Many businesses have reported that absenteeism has been reduced following the adoption of flexible schedules (Newman 1989). Managing performance becomes more difficult however, you cant judge performance by presence. You have to judge it by output whic h is harder to do (Newman 1989). Productivity Studies focusing on the impact of compressed work schedules on employee performance have produced mixed results (Dunham et al. 1987). Two decades and countless numbers of studies later and the same holds t rue. A 1999 psychological study on the effects that a compressed work schedule has on employee productivity and performance is one example. The 1999 study suggested that there are only a few hours a day where employees enjoy their peak period and perfo rm at optimal levels. Thus, having employees work longer hours (as

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17 is required in a compressed workweek work schedule) should increase the amount of time they are working at suboptimal levels (Baltes et al. 1999). The study further states that results of compressed -workweek -schedules have been mixed, with productivity either improving or staying the same after the implementation of a compressed workweek work schedule. Thus, although theoretically we would expect the implementation of a compressed workweek work schedule to lead to lower productivity, research does not support this claim (Baltes et al. 1999). The U.S. Department of Labor reported hours worked and output for combinations of five, six, and seven scheduled days and eight, nine, ten, eleven and twelve scheduled hours. Th e data is shown in Figure 2 1. The U.S. Department of Labor data document ed efficiency loss as it correlate d with hours per day, days per week and total hours per week. The base line representing 100% efficienc y or no efficiency loss was the 40 hour per week work schedule consisting of five 8 hour days per week (Schwartzkopf 1995). Work Life Balance and Employee Morale Leading corporations first installed comprehensive work/life programs [in the early 90s] de signed to draw more talent into the workplace and help employees focus on the tasks at hand (Hansen 2002). The high morale and satisfaction rates associated with theses work/life programs is a result of the perception of customization of work schedule, a matching of individual or team needs and work style with available options (Marquez 2008). Despite the time and money poured into these programs, few claim unmitigated success, and on an aggregate level, little has changed (Hansen 2002). Workplace surveys still register high levels of employee stress stemming from work/life conflicts (Hansen 2002). Hansen states that groups of minority workers and women continue to

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18 be unemployed or underemployed because of family responsibilities and bias in the workplace. In many cases the programs reach only the workers who need them the least (Hansen 2002). A roundtable discussion, sponsored by The New York Times Job Market, included nine HR executives from top companies and consultancies. When entry level employees were asked whether they considered themselves fast trackers (those willing to work time greater than minimum required in order to gain promotion and advancement within a firm) 10% answered in the affirmative but when senior level executives wer e asked the same question 60% said that they considered themselves to be fast trackers. While few entry level employees surveyed reported that they were willing to work additional hours for the purpose of promotion or advancement within a firm, the majorit y of senior level executives surveyed stated that they had worked additional hours for the purpose of promotion and advancement. These executives unanimously agreed that their firms were committed to promoting work/life balance. And while many of the fir ms offer ed flextime and extensive work/life benefits, most found difficulty in creating a corporate culture that supports these programs (Hansen 2002). Starwood Hotels and Resorts Worldwide, Inc. for example, offers flexibility for employees at corporate headquarters but cannot extend the same consideration to workers at the hotel properties, where shift work is common (Hansen 2002). Macys, a New York City retailer with 30,000 employees, faced similar limitations because store hours in the retail indus try are customer driven. Although these challenges exist, data from the U.S. Bureau of Labor Statistics suggests slow or no growth in work/life programs in recent years and the companies at the [business human resource officers] roundtable report few new programs (Hansen 2002). Research has been conducted on the use of alternative work arrangements in the private sector, showing significant relationships between alternative work arrangements and decreased

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19 employee turnover intentions, increased produ ctivity and job performance, and decreased levels of work -family conflict, as well as an indirect relationship with job dissatisfaction and general health (Facer and Wadsworth 2008). According to a Brigham Young University study, employees who work a 4/40 work schedule experience lower levels of at -home conflict, which they report translates to a higher job satisfaction and productivity (Facer and Wadsworth 2008). The BYU study included surveys of city employees working 4/40 schedules as well as surveys of their counterparts working 5/40 schedules, overall work life conflicts reported were significantly different (and lower) for the workers with the 4/40 schedule (Facer and Wadsworth 2008). The primary sources of conflict cited were family issues, being t oo tired, too heavy a workload and lack of time to spend with family/friends (Facer and Wadsworth 2008). Construction Ties The 10 -hour, four day workweek is essential to creating greater flexibility in the construction industry (Garrison 2008). Garrison also discussed how shortages of labor and competition between firms for fewer workers will force consideration of the 4/40 work schedule, as it is more attractive to potential workers. Some additional benefits of the 4/40 work schedule in construction a re: the ability to make up lost rain days without working on weekends, overtime can now be performed on a weekday as well, and productivity increases as a result of the longer work day (Garrison 2008). Summary Relatively little work has been published regarding compressed work weeks in the construction industry specific ally. As a result, data collected in this literature review, was used and adapted to develop formulas specific to the construction industry. The final intent was determining the feasibilit y of compressed workweeks in construction, their associated cost, and their associated benefits.

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20 Figure 2 1. Productivity loss as a function of work days per week and work hours per day

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21 CHAPTER 3 METHODOLOGY Introduction A feasibility study and cost benefit analysis of implementing a compressed workweek (or 4/40 work schedule) as it would be applied to the construction industry was conducted The types of organizations used for thi s analysis were both public and private in nature and there was n ot a specific targeted group. The methodology followed in this research was determined by the objective of the study and the hypotheses statements listed in the introduction. Steps Taken The steps taken were as follows: 1 A literature search was performed on material related to labor productivity, compressed workweek schedules and how it might relate to the construction industry. 2 The data needed for the analysis was identified. 3 The sources of data on 4/40 work schedules in public and private sectors were i dentified as key individuals in both a public and private organization/firm. 4 An interview was designed to collect the necessary data about 4/40 work schedule implementation in public and private sectors. 5 The interviews were administered to key individuals to obtain the data on 4/40 work schedules in both the public and private sectors. 6 The data collected was recorded and reported by the author in the results section of this thesis. 7 A determination of the feasibility of 4/40 work schedules in construction wa s made this determination was based on both the literature reviewed and the data collected. 8 A basic model, including limited variables, was developed for cost -benefit analysis of 4/40 work schedules for specific types of construction firms. 9 Recommendatio ns were made for future research regarding implantation of 4/40 work schedules in the construction sector.

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22 CHAPTER 4 INTERVIEWS Introduction Through the use of interviews, the author collected data. Basic data such as job title, name of firm and primary type(s) of business(es) performed were collected and recorded. Specific topical data collected and recorded included length of time on 4/40 schedule, how many employees on the 4/40 schedule and what groups of employees were on the 4/40 schedule (if not a ll). Additional details regarding employee morale, productivity levels and work life balance were also discussed Public Labor Representative Interview According to Dori Henry, press spokesperson for the head of Marylands department of labor, the state now offers 4/40 work schedules to more than seventy percent of state employees. The state has had some 4/40 work schedule programs since the first quarter of 2008. Key individuals were not on the 4/40 work schedule as their positions were considered essen tial for 5/40 work schedules. Productivity levels have been maintained at the pre implantation levels, and employee morale has increased at the office location. (Dori Henry, personal communication, November 26, 2008) The Maryland department of labor als o collects labor statistics on various public and private industries throughout the state. Ms. Henry advised that there have been construction businesses reporting the use of a compressed workweek, including use of the 4/40 work schedule. The elevator la bor union has been operating on a 4/40 workweek for many years. Other trade labor unions have reported similar work schedules.

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23 Private Firm Representative Interview According to Jennifer Brown, accounting executive for Stonewood Holdings, LLC, her firm offers 4/40 work schedules to all of its corporate headquarters employees. The firm had its corporate headquarters operating on 4/40 work schedules since 2007. Productivity levels have been maintained at the pre implantation levels, and employee morale ha s increased at the corporate office location. (Jennifer Brown, personal communication, December 9, 2008) Stonewood Holdings, LLC operates restaurants regionally throughout states in the southeast. Ms. Brown advised that due to the nature of the restaura nt business, restaurant employees are not offered the 4/40 work schedule. Ms. Brown advised that as a former restaurant employee, work schedules at individual restaurants are up to the managers, but often flexible or alternative work schedules are permitt ed and encouraged.

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24 CHAPTER 5 ANALYSIS OF RESULTS Productivity Loss Based on the U.S. Department of Labor data, the researcher determined a projected correlation for four scheduled days and ten, eleven and twelve scheduled hours was determined. Figure 5 1 shows U.S. Department of Labor data as well as the researchers projections for four scheduled days developed by calculating averages of efficiency loss based on hours per day, days per week and total hours per week worked. Figure 5 1 also shows that f our scheduled days with ten scheduled hours results in a projected productivity loss of two percent. This percentage, when multiplied by 40, computes the weekly productivity loss per employee as 0.8 hours per week. The total productivity loss (in dollars ) of a firm is computed by multiplying the number of employees working 4/40 schedules by the average cost per hour of those employees by 0.8 hours. Cost Benefit Formulas The information obtained through the research and interviews conducted have allowed fo r the isolation of specific and quantifiable costs potentially saved by implementing 4/40 work schedules. The following formulas were developed by the researcher to determine the exact amount of savings realized upon implementation of 4/40 work schedules. These are the formulas used in the example case study analyses: 1 Realized travel savings (per week) = 2 [(number of field employees average hourly cost average time to commute from office/branch) + (number of company vehicles average cost per mil e (including fuel, maintenance, etc.) average number of miles from office to jobsite)] 2 Realized set up and clean up savings (per week) = (set up time including material lay out, tool layout, etc. + clean up time including storing material, tools, etc. an d cleaning) average number of projects ongoing average hourly cost

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25 3 Realized productivity losses (per week) = efficiency loss number of employees average hourly cost 4 Total annual cost benefit of 4/40 work schedule = 52 ( realized travel savings + r ealized set up and clean up savings + realized productivity losses ) Example Case Studies Using the formulas, the researcher completed example case studies and analyzed the results to determine the projected cost benefit to construction firms of various siz e and scope. The estimated values for three different example firms were input into the researchers spreadsheet model to generate the results. Travel times used in the model include travel time from the firms office to the jobsite. Travel times do not include the commute time from the employees residence to the office. For firms that allow company vehicles to be taken home to the employees residence, a factor taking into account the firms policy on commute time must be determined. The first example case study, shown in Table 5 1, is for a very small firm (< 20 employees) with few employees that might travel longer distances to reach the jobsite. The average hourly cost would be higher as a result of a more experienced employee makeup and higher pe r employee non -wage costs such as insurance and benefits. The savings on set up/clean up time for the example firm are not huge due to the small number of concurrent projects. The travel costs are proportionally high due to the longer distance and time t raveled and the higher average hourly cost. Average cost per mile would change based on size of fleet and therefore is very close in all three case study examples. Realized productivity losses would also be low due to the small number of employees. At ju st over $62,000, annual cost savings associated with the implementation of 4/40 work schedules for a firm similar to the example in Table 5 1 would be significant.

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26 The second example case study, depicted in Table 5 2, is for a moderate sized firm (20 100 e mployees) with employees that might travel medium distances to reach the jobsite. The average hourly cost would be slightly higher as a result of an experienced employee and non experienced employee makeup and moderate per employee non-wage costs such as insurance and benefits. The savings on set up/clean up for the example firm are moderate due to the greater number of concurrent projects. The travel costs are relatively high due to the moderate distance and time traveled and the higher average hourly c ost. Average cost per mile would change based on size of fleet and therefore was reduced in example two. Realized productivity losses would be higher due to the greater number of employees. At just over $155,000, annual cost savings associated with the i mplementation of 4/40 work schedules for a firm similar to the example in Table 5 2 would be significant. The third example case study, depicted in Table 5 3, is for a large sized firm (>100 employees) with employees that might travel shorter distances to reach the jobsite. The average hourly cost would be slightly lower as a result of a lower experienced employee to non experienced employee ratio and lower per employee non-wage costs such as insurance and benefits. The savings on set up/clean up time for the example firm are higher due to the high number of concurrent projects and the increased size of projects performed. The travel costs are lower due to the shorter distance and time traveled and the lower average hourly cost. Average cost per mile wou ld change based on size of fleet and therefore was reduced in example three. Realized productivity losses would be higher due to the greater number of employees. At just under $492,000, annual cost savings associated with the implementation of 4/40 work s chedules for a firm similar to the example in Table 5 3 would be significant.

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27 Benefits Summary Table 5 4 shows some of the benefits of the 4/40 work schedule previously discussed. Table 5 4 separates the listed benefits into three categories: benefits to the employee, benefits to the employer and benefits to society. Some benefits are classified into more than one group. Table 5 1. Example c ase study #1 Realized Travel Savings N umber of employees 15 N umber of company vehicles 5 A verage commute to jobsite (miles) 50 A verage commute to jobsite (hours) 1 Average cost per mile (fuel, maintenance, etc.) $ 0.48 Average cost per hour $ 40.00 Total cost per day for travel $ 1,440.00 Realized Start/End Savings T otal time to setup (lay out material, move tools/equipment) 1 Total time to clean up (store materials, secure tools/equipment) 1 T otal # of projects (ongoing) 3 T otal cost of set up and clean up per day $ 240.00 Realized Productivity Losses 2% E fficiency loss (in hours per week) 0.8 N umber of employees 15 A verage cost per hour $ 40.00 Weekly productivity loss of 4/40 work schedule $ (480.00) Total Annual cost benefit of 4/40 work schedule $ 62,400.00

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28 Table 5 2. Example case s tudy #2 Realized Travel Savings N umber of employees 50 N umber of company vehicles 25 A verage commute to jobsite (miles) 35 A verage commute to jobsite (hours) 0.7 Average cost per mile (fuel, maintenance, etc.) $ 0.47 Average cost per hour $ 32.00 Total cost per day for travel $ 3,062.50 Realized Start/End Savings T otal time to setup (lay out material, move tools/equipment) 1 Total time to clean up (store materials, secure tools/equipment) 1.5 T otal # of projects (ongoing) 15 T otal cost of set up and clean up per day $ 1,200.00 Realized Productivity Losses 2% E fficiency loss (in hours per week) 0.8 number of employees 50 A verage cost per hour $ 32.00 Weekly productivity loss of 4/40 work schedule $ (1,280.00) Total Annual cost benefit of 4/40 work schedule $ 155,090.00

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29 Table 5 3. Example case s tudy #3 Realized Travel Savings N umber of employees 300 N umber of company vehicles 125 A verage commute to jobsite (miles) 25 A verage commute to jobsite (hours) 0.5 Average cost per mile (fuel, maintenance, etc.) $ 0.46 Average cost per hour $ 28.00 Total cost per day for travel $ 11,275.00 Realized Start/End Savings T otal time to setup (lay out material, move tools/equipment) 1.5 Total time to clean up (store materials, secure tools/equipment) 2 T otal # of projects (ongoing) 50 T otal cost of set up and clean up per day $ 4,900.00 Realized Productivity Losses 2% E fficiency loss (in hours per week) 0.8 N umber of employees 300 A verage cost per hour $ 28.00 Weekly productivity loss of 4/40 work schedule $ (6,720.00) Total Annual cost benefit of 4/40 work schedule $ 491,660.00 Figure 5 1. Productivity loss as a function of work days per week and work hours per day with projections for 4 days per week

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30 Table 5 4 4/40 Benefits by g roup Employee Employer Society Time Savings Improved Morale Productivity Roadway Use Traffic Increased Time For Friends & Family Cost Savings Recruiting Absentee Rate Employee Turnover Energy Conservation

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31 CHAPTER 6 CONCLUSIONS AND RECO MMENDATIONS Conclusions After completing this study on 4/40 work schedules, the researcher determined that 4/40 work schedules are feasible in construction. Although they could realize some of the benefits of 4/40 work schedules, construction management and field supervision fir ms would likely find 4/40 work schedules not feasible. This is due to the typical requirement that construction management and field supervision personnel are present at all times any work is performed on a project. Other reasons might include insurance, security and scheduling logistics. The feasibility of 4/40 work schedules is greatest for firms of small or specialized capacity and small trade firms with specific work that can be completed within the compressed workweek format. Additionally these fir ms stand to have the greatest benefit by implementing a 4/40 work schedule. While the value of the benefits of increased employee morale or better work life balance cannot be readily quantified, it can be assumed that employees that are more productive work safer. Cost savings associated with a safer work environment, especially in construction, may be huge. Other factors such as decreased wear and tear on roadways can benefit society and governments as a whole. Reduced traffic congestion may also be rea lized through the implementation of 4/40 work schedules. It is the author s belief that 4/40 work schedules, when implemented properly, are feasible and cost -beneficial in certain construction organizations. Recommendations Based on the analysis complete d, leaders and decision makers in the construction industry can be given advice based on the type of firm that they represent. Implementation of 4/40 work schedules would be advisable only in firms of small or specialized capacity and small trade firms w ith specific work that can be completed within the compressed workweek format. It

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32 is not advisable to implement the 4/40 work schedule in large, unspecialized firms that have primary functions in construction management, scheduling or field supervision. Recommendations regarding 4/40 work schedules would also depend greatly on specific project schedule or duration. For projects with compressed duration or when fast -tracking is required the 4/40 work week may only be an option when utilized in conjunct ion with overtime or multiple shift work schedules. Conversely when the duration of a project is of secondary importance (to cost or quality), 4/40 work schedules may be a very attractive option for the right firms employed on that particular project. The 4/40 work schedules, when implemented properly, are cost effective. The 4/40 work schedules do offer cost savings by improving productivity, reducing expenses, and improving worker morale. In order to determine the exact amount of cost savings realized specific studies targeting that data would need to be performed. Future studies should determine the specific effects that 4/40 work schedules will have on different types of construction firms be performed. This study was limited to data collected regard ing non -construction firms where 4/40 work schedules had been implemented and therefore has limitations on accuracy within the construction sector. Future specific, targeted and controlled research studies would be recommended to determine actual results of 4/40 work schedule implementation. These studies would have the most value if they target specialized trade firms on large scale projects that are not required to fast track the schedule of said project.

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33 REFERENCES Baltes, B., Briggs, T., Huff, J., W right, J., and Neuman, G. (1999). Flexible and Compressed Workweek Schedules: A Meta -Analysis of Their Effects on Work Related Criteria. Journal of Applied Psychology, 84(4), 496513. Boxx, W., and Calvasina, E., (1975). Efficiency of Workers on the Fo ur Day Workweek. The Academy of Management Journal, 18(3), 604610. Buisman, B., (1975). 4-Day, 40 Hour Workweek: Its Effect on Management and Labor. Personnel Journal, 54(11), 565567. Da lphonse, S., Fleury, M., Daniel, L., McLellan, E., and Nelson, W (2007). Great Places to Work. Washingtonian, November, 85 109. Dunham, R., Pierce, J., and Castaneda, M. (1987). Alternative Work Schedules: Two Field Quasi Experiments. Personnel Psychology, 40(1), 215242. Facer, R., and Wadsworth, L., (2008). Alternative Work Schedules and WorkFamily Balance. Review of Public Personnel Administration, 28(2), 166177. Fenn, D., (1995). Long Hours for Long Weekends. Inc., 17(6), 137. Fottler, M., (1977). Employee Acceptance of a Four Day Workweek. The Academy of Management Journal, 20(4), 656668. Frauenheim, E., (2006). Even The Best Employers are Trimming Back. Workforce Management, January 30, 1617. Garrison, T., (2008). The Need for Greater Flexibility in Working Conditions. Changing Constr uction 8(3), 48. Gehrke, S., (2008). Shorter workweek long on satisfaction. The Salt Lake Tribune, June 10, Local 11. Gilbert, M., (1997). Longer days, shorter weeks: compressed work weeks in policing. Public Personnel Management, 26(3), 391403. Griffin, I., (2008). Jobs saved as workers agree to reduced hours. Leicester Mercury, November 17, 12. Hansen, F., (2002). Truths and Myths About Work/Life Balance. Workforce, December, 34 39. Hartman, R., and Weaver, K., (1977). Four Factors Influe ncing Conversion To A Four Day Work Week. Human Resource Management, 16(1), 2427.

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34 Holland, C., (2008). Should We Embrace a Four Day Workweek? Team Taskmaster, < http://bnet.com/teamwork > (October 23, 2008). Kadaba, L., (2008). Compressed workweek: 4 a nd 10, do it again. The Philadelphia Inquirer, September 24, C01. Kiger, P., (2008). Relief for Pain at the Pump. Workforce Management, August 11, 2229. Marquez, J., (2008). Utah: Closed Fridays. Workforce Management, July 14, 13. Newman, S., (19 89). Working alternatives. Supervision, 50(7), 1113. Puntenney, P., (1994). Adopting An Alternative Work Schedule In A Manufacturing Environment. Production And Inventory Management Journal, 35(1), 6872. Schwartzkopf, W., (1995). Calculating Lost Labor Productivity In Construction Claims, Wiley Law Publications, New York. Sunoo, B., (1996). How To Manage Compressed Workweeks. Personnel Journal, 75(1), 110. The 4X10 Solution. (2008, September). Governi ng Magazine, p. 19. Thursdays the new Friday. (2008, August 29). Topeka Capital Journal p. 2.

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35 BIOGRAPHICAL SKETCH Drew Berman was born in Baltimore City, Maryland. The middle of three children, he grew up mostly in Baltimore County, Maryland, graduat ing from Pikesville High School in 1 998. He earned his B.A. business a dministration with a minor in education from The University of Florida (UF) in 2002. Upon graduating in May 2002 with his B.A., Drew began instructing Baltimore City high school students in automotive vocational education programs. In May 2003, Drew began working for The Progressive Corporation handling insurance claims. Positions held at Progressive included, Claims Representative, Network Accounts Manager, Salvage Manager, and Catas trophe Specialist. Drews work provided immediate response aid to policyholders a ffected by catastrophes such as Hurricane Isabelle (2003), Hurricane Charley (2004), Hurricane Francis (2004), Hurricane Ivan (2004), Hurricane Jeanne (2004), Hurricane Katri na (2005), Hurricane Wilma (2005) and a host of other severe hail, tornadoes and hurricane events. Drew parted from Progressive to return to The University of Florida to p ursue his Master of Science in building c onstruction. Drew obtained the designation of LEED accredited professional. He received his M.S.B.C. from the University of Florida in the spring of 2009.