Remuneration and absenteeism on a large construction site

Abstract

While scholarly consensus is that construction absenteeism is a serious and widespread problem, aggregate US and Canadian data show construction absenteeism rates substantially below cross-industry averages. While construction absenteeism research focuses on workplace culture and norms, contractors continue to manage absenteeism primarily as an individual problem. While remuneration and labour market conditions are generally acknowledged to influence construction absenteeism, little research has focused on these factors. High labour turnover in construction resolves the first two conundrums. Adapting to higher labour turnover by limiting investment in firm-specific human capital, contractors are quicker to fire absent workers reducing construction’s measured absentee rates. Higher labour turnover also constrains contractors’ ability to shape workplace culture while facilitating the individual treatment of absentee workers. The construction absentee literature’s methodological focus on workplace surveys explains the absence of research on labour market conditioning of construction absenteeism. This case study using payroll data from a large, unionized US industrial construction site shows not only that absenteeism leads to discharge, but also, that absenteeism is a precursor of both quits and discharges for reasons other than absenteeism. Furthermore, a 1 percentage point increase in the unemployment rate reduced the probability that a worker would be fired for absenteeism by 48%; a $100 increase in weekly overtime pay reduced a worker’s probability of being fired for absenteeism by 27% and a $100 increase in per diem or travel pay reduced a worker’s probability of being fired for absenteeism by 75%.