Main contractors will be coughing up more and earlier too for steelfixing labour as a predetermined wage increase agreement kicks in.
In a joint press release last Friday, the Hong Kong Bar-Bendering Contractors Association and the Hong Kong Construction Industry Employees General Union announced that starting on 1 May for the year 2013-14, the daily wage for casual steelfixers would be set at HK$1,490.
This sum includes the employee’s MPF contributions, statutory benefits and travel allowance and represents an increase of 9.6 percent on the rate of HK$1,360 set for the period from August 2012 to April 2013.
For the year 2014-15, the rate would increase further to HK$1,710 per day.
The increases were agreed after negotiations with the Hong Kong Construction Association, the trade association representing the main contractors.
Originally the date when the new rate would go into effect would be 1 August but the parties agreed to an earlier date.
The rate increases though were announced last year.
The government has increased public infrastructure spending in recent years and along with increased investment on private development projects this has led to increased demand for construction workers and hence pushed up wages.Union chairman Chow Luen-kiu hoped the deal with steelfixers on the date of implementation would be adopted during talks on wages for the other trades.
HKCA president Thomas Ho On-sing said it was necessary to increase wages and provide for a schedule of wage increases to firstly demonstrate the construction industry and the steelfixing trade had good prospects and secondly to also allow contractors to better estimate costs during tendering.
Asked if the near 10 percent increase for 2013-14 was a bit too high, Ho said workers should share in the increased prosperity arising from the construction boom.
Ho agreed that contractors on fixed price contracts would see some cost pressures but said: “Short term pain is better than long term shortage of workers.”
A quantity surveyor for a listed contractor said the current steelfixing labour rate for building works and main civil structures was about HK$1.6 to 1.8 per kilogram, rising to HK$2.7 per kilogram for work in manholes.
The material cost of high yield steel reinforcement stood at about HK$4.5 per kilogram.
He said subcontractors were currently quoting all-in prices of about HK$7,200 per tonne for steel fixing while rebar suppliers were quoting prices of HK$4,300 per tonne.
“[There has] been little increase in prices in the recent half year,” the QS said.