Browse > Article
http://dx.doi.org/10.12652/Ksce.2022.42.6.0853

Improvement in Calculating Engineer Standard Wage Rate and Its Appropriate Level Computation  

Lee, Jae Yul (Korea Engineering & Consulting Association)
Lee, Hae Kyung (Korea Engineering & Consulting Association)
Publication Information
KSCE Journal of Civil and Environmental Engineering Research / v.42, no.6, 2022 , pp. 853-860 More about this Journal
Abstract
The purpose of this study is to suggest an improvement plan for the calculation method of the engineer standard wage rate (ESWR) and to compute a reasonable ESWR. To this end, an adequacy review of theESWR calculation criteria was conducted along with an extensive engineering industry survey. The survey results were analyzed using an effective response sample of 748 companies out of 1,000 survey samples extracted by stratifying the 5,879 survey population. The main results were as follows. ①When calculating the engineering service fee, the prime contractor's engineer wage is suitable for the ESWR. The ESWR can be estimated by the formula 'average wage÷[1-proportion of subcontract orders×(1-subcontract rate)].' ② The field survey showed that the number of monthly working days was 20.35-20.54 days at 99 % confidence interval, which was significantly different from the current standard (22 days). In addition, as a result of a legal review of the ESWR criteria, it was found that the number of working days should be calculated in accordance with the Labor Standards Act after 2022. ③ Applying government guidelines, the time difference between the wage survey and the ESWR application can be corrected by the past ESWR increase rate for a specific period. ④ Using modeling based on the analysis above, the current ESWR was 13.5-14.5 % lower than the appropriate level. A lower ESWR was driven by the non-reflection of subcontract structure (4.1 %), overestimation of monthly work days (6.8-7.8 %), and application of past wage (2.6 %). The proposed model is expected to be widely used in policy making, as it can provide a useful framework for calculating the standard wage rate in similar industries as well as calculating appropriate engineering fees.
Keywords
Engineer standard wage rate; Cost plus fee method; Engineering wage survey; Prime contractor's engineer wage; Monthly work days; Escalation index;
Citations & Related Records
연도 인용수 순위
  • Reference
1 Lee, T. W. and Lee, G. (2014). "A study on practical ways to improve pricing criteria for technical service contracts." Korean Journal of Construction Engineering and Management, Vol. 3, No. 1, pp. 97-106 (in Korean).
2 Ministry of Finance and Economy (MOEF) (1995). Document No. Accounting 45101-45: How to apply the market wage according to the change of the standard wage rate calculation method and how to adjust contract amounts according to price change, etc. (in Korean).
3 Ministry of Science and Technology (MSIT) (1974). Public Notice No. 49: Selection criteria for rate application method in engineering service contracts (in Korean).
4 Nam, S. H. and Park, H. K. (2020). "A study on the construction cost index for calculating conceptual estimation: 1970-1999." Journal of the Korean Society of Civil Engineers, KSCE, Vol. 40, No. 5, pp. 527-534 (in Korean).   DOI
5 Philips, P. (2014). Kentucky's prevailing wage law: An economic impact analysis, University of Utah, Department of Economics, Utah.
6 Statistics Canada (2013). 2011 Farm financial survey (Catalogue no. 21F0008XIB), Ottawa, pp. 119-120.
7 The Bank of Korea (BOK) (2022). Economic statistics system, Available at: https://ecos.bok.or.kr (Accessed: June 22, 2022). 
8 Brown, C. E. (1998). Coefficient of variation. in: Applied multivariate statistics in geohydrology and related sciences, Springer, Berlin, Heidelberg, pp. 155-157.
9 Cho, H. H. and Doe, G. Y. (2005). "Improvement of contract sum adjustment method caused by price fluctuation using construction cost index." Korean Journal of Construction Engineering and Management, Vol. 6, No. 1, pp. 162-168 (in Korean).
10 Jin, Z. X. and Baek, S. H. (2020). "Identification of primary activity and management plan for construction standard unit price." Journal of the Korea Academia-Industrial Cooperation Society, Vol. 21, No. 10, pp. 589-601 (in Korean).   DOI
11 Kim, D. M. (2005). "Logical grounds of the productivity-wage system as a way to determine reasonable wage levels." Korean Journal of Industrial Relations, Vol. 15, No. 1, pp. 1-21 (in Korean).
12 Lee, C. H. and Kim, B. S. (2018). "Improvement of personnel cost and placement scale of quality manager for construction." Journal of the Korean Society of Civil Engineers, KSCE, Vol. 38, No. 2, pp. 327-335 (in Korean).
13 Lee, J. H. and Baek, S. H. (2020). "Development of survey framework for prevailing wage in the construction industry." Journal of the Korea Academia-Industrial Cooperation Society, Vol. 21, No. 1, pp. 138-147 (in Korean).
14 Lee, J. Y. and Hwang, S. S. (2022). "A study on the development and application of engineering BSI." Journal of the Korea AcademiaIndustrial Cooperation Society, Vol. 23, No. 7, pp. 548-557 (in Korean).
15 Lee, K. H. and Son, C. B. (2020). "Improvement measures of wage estimation system for construction skilled workers." Journal of The Korea Institute of Building Construction, Vol. 20, No. 3, pp. 223-233 (in Korean).