A practical system for measuring worker productivity is an essential prerequisite for the\ud design of national and regional construction labor productivity improvement programs in Indonesia. It is important, because labor not only constitutes a large part of construction cost, but also susceptible to the influence of construction management. Indonesian construction industry needs a series of productivity indices, which should be designed to allow contractors to compare the performance of their projects with other similar projects, and to analyze different type of construction processes in order to identify problem areas and potential for productivity improvement at the source of problems. Appropriate construction productivity measurement provides the basis for determining trends and levels of productivity as well as the impacts of corrective action. It will assist project owners and construction managers: to manage projects effectively; to detect problems and adverse trends for necessary corrective action; to determine impacts of changed construction methods or conditions; to identify high and low areas of productivity and reasons for the differences; to compare project\ud performance by region; to compare performance of different contractors; and to provide a means to assess cost effectiveness in construction. This paper discusses the method for measuring standard worker’s performance and productivity rates for improving construction cost estimation, and for assisting the definition of worker/job performance standards. Observations had been conducted in selected road and bridge construction projects at 13 provinces in Indonesia. Data obtained from observation of work processes and time measurements at the various construction sites were evaluated and analyzed to obtain productivity and performance indicators at project, regional and national levels.\ud Non-productive activity time measurement will then be used as a tool to improve the worker performance by introducing corrective and preventive actions for every non-productive working elemen
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