Are Contractors In Construction Industry Paid Well?

Construction Industry
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A home is truly a family’s prized possession and the families that build their own home will vouch for the fact that it is nothing less than a labor of love. Once the home is built, more often than not, we forget about the people who worked behind the scenes and help construct the dream. The construction industry is filled with such skilled workers without whom building a home will never be a reality.

Finding the right home contractors:

Building a home, home improvement or home remodeling has different needs and hence they need different people with certain skill sets to undertake and successfully complete the task. It is also possible that when you need to get a task done, the different home improvement contractors or home remodeling contractors will most likely give you different quotes for the exact same job. So it’s important to find the right home contractors according to the needs of the job to be done and your budget.

Types of contractors:

The three main types of contractors based on the contracting services would be:

  1. General Contractors
  2. Specialty contractors
  3. Freelance workers

General contractors:

The general contractor can be described as the head of the project. He organizes and decides the strategy of getting the task completed. He oversees all the different required aspects of the project such as permits, legal requirements etc.

He will decide and schedule the different people to do their jobs such as plumbers, electricians, roofers etc. so that the tasks can be done efficiently and in the least amount of time.

Since the general contractor acts as a supervisor overseeing all the aspects of the job, he is most likely not to do any of the work himself.

General Contractors

Specialty contractors:

These contractors usually take care of specialized services such as plumbing or termite treatment. They have a team and they are licensed and insured. There might a large number of local home improvement contractors in your area and it would be a good idea to search for them in the local contractor’s directory and check their credentials before hiring them.

Specialty contractors

Freelance workers:

Freelance workers are the ones who might have some experience in the field of construction but they might not be able to complete a difficult task themselves due to lack of expertise. It would mostly be necessary to demonstrate and supervise the task assigned to them.

How much money do they make?

  1. General Contractors:

The advantage of hiring a general contractor is that he is your single point of contact for the project. You hire him and then only pay him collectively for all the tasks that need to be done. He will most likely charge you an extra amount of the time and energy he spent on finding the required subcontractor.

Also, general contractors charge you an extra overhead charge since they are the ones managing the schedule, budget and personnel for your project. This overhead charge could increase your cost by approximately 10% to 30%.

  1. Specialty contractors:

Specialty contractors are most definitely not the cheapest. They have their licenses, insurance and credentials in place and they are going to charge you a decent amount of money for the time they spent in doing so.

  1. Freelance workers:

Freelance workers are probably the ones whose labor cost would be the cheapest. The reason being that while they would have an overview of how to get things done, they might not be fully equipped with the knowledge or experience to solve it by themselves.

Are contractors in construction industry paid well?

Since most of the contractors do different kinds of jobs, and they do not have set salaries, their pay would be dependent on the magnitude of the projects they handle. While some may make a huge amount of money on large construction contracts, the others might not be so lucky.

Since the construction industry is a competitive industry due to its contract process, the margins on the various jobs could range from as low as 3 to 4 percent to as high as 15 to 75 percent.

As per a recent survey, the construction industry seems to be enjoying the beginning of a boom and hence an increase in a number of jobs and wages. It is observed that the pay for contractors has increased by an average of about 5%.

The construction industry is not a steady one, with its swinging ups and downs. The downside to this is that while some contractors make huge margins, some others barely get by during a lean cycle.

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