Assessment of Demand & Supply of Quantity Surveying Professionals to the Sri Lankan

Construction Industry

Seneviratne, L.D. Indunil. P. Department of Building Economics, Faculty of Architecture, University of Moratuwa.

(email: isenevi@gmail.com ) Perera ,B.A.K.S.

Department of Building Economics, Faculty of Architecture, University of Moratuwa. (email: pererabaks@yahoo.co.uk )

Yapa,B.S. Department of Building Economics, Faculty of Architecture, University of Moratuwa.

Abstract

Quantity Surveyors are the cost consultants in construction. They possess expert knowledge in construction costs, material usage, and labour norms. Quantity Surveyors have their expertise in project finance, project cash flows, contractual procedures and legal aspects pertaining to construction. Due to the present scarcity of labour, material and finance, Quantity Surveying profession has got recognized in both domestic and international markets.

Sri Lankan construction sector has shown 6.7 % growth as per central bank bulletin in the third quarter of 2005. Tsunami reconstructions also contributed to the above growth. Simultaneously demand for Quantity Surveyors has also increased significantly.

This research is focused on analyzing the demand and supply of Quantity Surveyors to the Sri Lankan construction industry. Several demand factors were identified for the period of last five years, which has caused to increase the number of job opportunities.

Supply sources of Quantity surveyors were also identified and compared for the contribution. As per this study on evaluation and forecast of demand and supply, Supply of graduate and non graduate Quantity Surveyors is insufficient to cater the future demand. Therefore, supply sources are to be stimulated to meet the demand of the industry.

Key words: Quantity Surveying, Demand, Supply, Graduates ,Non-Graduates

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1. Background

1.1 Introduction

The construction industry, being the means by which society shapes the built environment, carries considerable responsibility in ensuring that building and civil engineering work of the highest standard is achieved in prevailing constraints. Historically, the construction industry has played an important part in meeting the social, economic and technological demands of developing civilization. The role can therefore be defined as being the management of resources in the development, production, maintenance and disposal of capital assets [3].

But with the likely changes in society, the role of the Quantity Surveyor has been evolved constantly and the present Quantity Surveyors practice their competencies in diversified paths within the construction industry and as well as beyond the boundaries of the construction industry [1].Since the construction industry becomes more significant in the economy and it has created more employment opportunities to the nation [8].

The market forces regulate demand and supply for the labour which decides the price of the labour which has a greater impact on the business, government policies, general education and the technical and vocational education. Demand for labour is the number of employment opportunities available in the public and private sector institutions within the country and overseas as well. Supply of the labour represent the number of workers enter into the world of work from schools, universities, and technical and vocational training institutions.

The visible changes and growth of Sri Lankan construction industry have forced the Sri Lankan Quantity Surveying profession to evaluate its demand and supply.

1.2 An overview of the Quantity Surveying Profession

A Quantity Surveyor is the person controlling the financial aspects of a building project. They are the 'accountants' of the building industry does planning and managing the cost of building projects from start to finish. More descriptively, the Quantity Surveyor is the one who “ensures that the resources of the construction industry are utilized to the best advantages of society by providing, inter alia, the financial management for projects and cost consultancy services to the client and designer during the whole construction process”. (Ashworth and Hogg 2002 cited by [4] ).The role of the Quantity Surveyor is currently more vital than the profession when it was originally established in England in 1785.

The Quantity Surveyors work in conjunction with architects, consulting engineers and contractors safeguarding the client's interests as an independent professional with specialist skills. Once the Quantity Surveyor has been employed or commissioned by a client, Quantity Surveyor turns considerable expertise to ensure that the client gets full value for money. So that they have to keep in touch with appreciate and understanding all aspects & disciplines of

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building, construction practice, design and engineering combined and be able to cost fairly, accurately and precisely [7].

The origin of Quantity Surveying in Sri Lanka can be traced back to the British era. British Quantity Surveyors were employed during colonial period in the Public Works Department of Sri Lanka. During World War II these Quantity Surveyors left the country. Later, Sri Lankans who had the opportunity of obtaining foreign education returned and practiced as Quantity Surveyors [5]. As per Miskin 1993 [3], in the past the only course available in Quantity Surveying was the Builders’ Quantities course at Ceylon technical college. Today, there are number of Quantity Surveying programmes, in Sri Lanka such as a four year BSc honors degree course in Quantity Surveying at University of Moratuwa ( started in 1985), a three year part time National Certificate of Technology course conducted by technical colleges throughout the country and other courses conducted by private sector organizations.

1.3 Significance of Quantity Surveying Profession in Sri Lanka

Labour as a factor of production plays an important role in the socio economic development of the country. A labour market is the place where both suppliers and buyers of labour meet together. In the case of Quantity Surveying profession, it has a significant importance in the construction industry both in local and international labour market. Following data (Refer table 1 and 2) represents the fact that, how much Quantity Surveying profession is significant in the industry. The data have been obtained through LABOUR MARKET Information Bulletin published by the Tertiary and Vocational Education Commission, Ministry of Vocational and Technical Training.

Table 1-Ranking for High Demand Foreign Jobs

Rank Occupation / Jobs

2001 2002 2003 2004 2005

Nursing

Computer operator

Civil Engineer

Accountant

Quantity Surveyor

1

2

3

4

5

1

2

3

4

5

1

---

2

3

4

---

4

1

2

3

1

2

3

5

4

Source: LABOUR MARKET Information Bulletin 2005

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Table2-Foreign Job Orders

Job Orders Job Category

2001 2002 2003 2004 2005

Technical general

Technical- AC & Ref.

Quality Controller

Nurse

Computer Operators

Quantity Surveyors

Technician-MEP

765

1079

387

1065

507

115

106

862

711

648

657

532

110

137

1281

1017

734

1147

109

132

167

833

468

307

---

219

197

145

1,898

1,102

710

687

445

255

290

Source: LABOUR MARKET Information Bulletin 2005

Due to the continuous changes in the industry and development of technology, the profession has faced many, threats and opportunities. In whatever the dimension profession shapes, the financial management expertise of the Quantity Surveyor remains in the demand [8].

1.4 Aim

The ultimate aim was the assessment of demand and supply of Quantity Surveying professionals to the Sri Lankan construction industry.

1.5 Research Methodology

Research methodology was mainly divided into two sections as far as there are two main categories in this research. The two main categories are Demand and Supply Measures of Quantity Surveying profession.

In order to identify the factors that are being demanded by industry, news paper survey was done by referring weekend papers from January 2002 to December 2006. All the local Quantity Surveying advertisements were taken into consideration monthly wise when analyzing the factors. When the sample of Quantity Surveying vacancies in the news papers was selected, convenience sampling method was used since this research is under exploratory category. Forecasting was done using Time Series Analysis.

In the supply measures, it was mainly done to establish the number of Quantity Surveyors passing out from relevant institutions from January 2002 to December 2006. Three sources of evidence were used for data collection in this study. They were documentation, archival records and semi structured interviews. The table 3 provides variety and mix of interviewees

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comprising the respondents from Universities Grants Commission Sri Lanka , University of Moratuwa, Vocational Education Commission, Ministry of Vocational and Technical Training.

Table3-Variety and Mix of Interviewees

Name of the organization Nr of Interviewees University Grants Commission Sri Lanka 2 University of Moratuwa 3 Tertiary and Vocational Education Commission 3 Ministry of Vocational and Technical Training 3

2. Research Findings and Analysis

2.1 Demand Side

The figure 1 illustrates number of job advertisements published in news papers for gradates and non graduates since 2002. Compared to year 2003, year 2004 has shown 140% growth. Reason for this hike in year 2005 is tsunami reconstructions and there are number of preferred fields specified in advertisements.

Figure 1- Total Number of Job Advertisements

TO TAL NUMBER O F JO B ADVERTISEMENTS

48 59

146

247301

050

100150200250300350

2002 2003 2004 2005 2006

Years

Num

ber

of J

ob

Adv

ertis

emen

ts

2.2 More Preferred Fields

In this research, major areas/fields of preference were identified as building, civil, both building & civil and mechanical, electrical, plumbing (MEP) work. The percentages were taken considering total number of advertisements. According to the findings, employers are looking for specialize Quantity Surveyors for relevant field. There are many opportunities available in building sector rather than civil engineering sector. However, Quantity Surveyors who have both civil engineering construction and building construction experience shows increasing demand. Quantity surveyors in MEP sector is minimal, because its complexity or unavailability

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of Quantity Surveyors in the market. Category “field unspecified” is for open ended advertisements which are advertised without the required field. However, field unspecified advertisements have been reduced over the period ( refer figure 2).

MORE PREFERD FIELDS

05

1015202530354045

Building

Civil

Civil/B

uilding

MEP work

field un

specif

ied

% o

f Job

Adv

ertis

emen

ts

2002

2003

2004

2005

2006

Figure 2 - Graphical Representation of More Preferred Fields

2.3 Experiences Requested

Most of the advertisements used to request work experience (refer table 4 and 5). In graduates category 1 – 3 years experience is the popular request.14 % - 17 % of advertisements have invited without any experience for graduates. In non graduates categories 5 – 7 years group is in better side. It is only 4% - 7% of non graduates are invited without experience. However, “field unspecified” has diminishing over the years.

Table 4 - Percentage Experiences Requested for graduates

Year Category

2002 2003 2004 2005 2006

Without Experience 14 % 14 % 12 % 15 % 17 %

1 - 3 Years 25 % 33 % 31 % 34 % 37 %

3 – 5 Years 22 % 24 % 23 % 22 % 21 %

5 – 7 Years 14 % 12 % 16 % 13 % 10 %

More than 7 Years 9 % 7 % 8 % 7 % 7 %

Field Unspecified 16 % 10 % 10 % 9 % 8 %

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Table 5 - Percentage of Experiences Requested for Non Graduates

YEAR CATEGORY

2002 2003 2004 2005 2006

Without Experience 4 % 7 % 5 % 4 % 4 %

1 - 3 Years 4 % 6 % 10 % 14 % 16 %

3 – 5 Years 18 % 21 % 21 % 22 % 21 %

5 – 7 Years 30 % 33 % 30 % 29 % 31 %

More than 7 Years 23 % 15 % 16% 17 % 16 %

Field Unspecified 21 % 18 % 18 % 14 % 12 %

2.4 Graduate and Non Graduate Share in the Market

According to the data collected on market share of graduates and non graduates (refer table 6), market share of graduates have been reduced during the last five years. Only in year 2002 they have higher market share. Rapid incensement of non graduate supply, constant graduate supply, employment boom for graduates in middle east and low return from overseas, are the reasons for the decrease in graduate share.

According to the above table 6 , it can be undoubtedly seen that share of the graduates has been decreasing. Since 2003, share of non graduates has been increasing while maintaining a 60 % average mean. This may be due to several issues as such availability, high salary rate and increases in supply.

Table 6 - Graduate & Non Graduate Share

YEARS CATEGORY

2002 2003 2004 2005 2006

Graduate 53% 42% 40% 35% 34%

Non Graduate 47% 58% 60% 65% 66%

According to the above table 6 , it can be undoubtedly seen that share of the graduates has been decreasing. Since 2003, share of non graduates has been increasing while maintaining a 60 % average mean. This may be due to several issues as such availability, high salary rate and increases in supply.

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0

100

200

300

400

500

600

2002 2003 2004 2005 2006 2007Years

Vac

anci

es

Non Gradute Graduate Forecast

2.5 Graduate and Non Graduate Demand Forecasts

Figure 3 - Graduate & Non Graduate Demand forecast

This section mainly focuses on detail evaluation of demand and forecasting the future demand of both graduates and non graduates by analyzing Quantity Surveying vacancies appeared in last five years. More precise forecast was done for year 2007 using time series analysis. In order to identify the variation of this time series, vacancies are counted yearly and shown in the figure 3. It can be stated that still graduates have increasing trend in their graph while non graduates are proceeding with small variations. In between 2005 and 2006 the rate of increase has changed. The more information regarding those scenarios has been elaborated in demand and supply evaluation.

2.6 Evaluation of Demand & Supply

2.6.1 Graduate demand and supply

When comparing the demand and supply for Quantity Surveyor’s, the supply is not keeping with demand (refer figure 4 and 5). According to the figure 4, the gap between the two graphs is increasing. Even though supply is not up to satisfactory level still demand has been continuing to increase. It can also be clearly seen by the forecast. The demand in year 2005 and 2006 has increased significantly due to Tsunami reconstruction works. Figure 4 has been presented using all pass out graduate students. However the average supply of graduates to the Srilankan market is still lower than shown in the graph since most of the graduates are leaving the country after six months time from their graduation.

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0

50

100

150

200

250

300

350

400

2002 2003 2004 2005 2006 2007Years

Gra

duat

e V

acan

cies

Demand Supply Forecast

Figure 4 - Graduate Demand and Supply Forecast

2.6.2 Non Graduate demand and supply

The figure 5 illustrates the demand and supply curves for non-graduates. The year 2002,2003 shows the higher supply than the demand. But since 2003 the trend has reversed and the gap between demand curve and supply curves are increasing significantly with a similar trend to the graduate graph. The Figure 5 also illustrates the impact of Tsunami reconstruction work, where there is a significant raise in demand between 2005 and 2006.

0

100

200

300

400

500

600

2002 2003 2004 2005 2006 2007Years

Non

Gra

duat

e V

acan

cies

Demand Supply Forecast

Figure 5 - Non Graduate Demand and Supply Forecast

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3. Conclusion

The profession of Quantity surveying has to meet demands of the market as all other professions. Quantity Surveying profession explored opportunities and expanded today due to scarcity of economic goods, improved living standards, and advancement of the technology in Sri-lanka. In order to forecast the future demand, it was required to assess the demand and supply situation of the profession in the present market.

According to the identified demand factors, Quantity surveyors who have experience in civil engineering construction and building construction are the individuals who have highest demand. When considering the professional qualifications and experience, graduates who have minimum two years experience and non graduates with more than four years of experience are the most attractive range for employers. Further for the period under review the market share of 60% has been filled by non graduates due to the non availability of graduates in the domestic market.

To fulfill the above demands, most of the non graduates are produced by technical colleges. An average of 235 students sat for the final year examination of each year and 60% of them have passed out from technical colleges at the end of each year. The University of Moratuwa is the sole supplier of graduates, where it produces 40 students per annum.

As per the market demand analysis and the supply side assessment, it can be recommended to significantly increase the supply of graduate and non graduate Quantity Surveyors and further to acquire experience in civil engineering construction. This would definitely enhance the quality of Quantity Surveying practice in Sri Lanka as well as reap higher financial benefits to the individuals with both civil and building experiences.

References

[1] Brandon P.S. (1990) Quantity Surveying Techniques; New direction, Blackwell Science Ltd, London.

[2] Central Bank of Sri Lanka. (2005) Central Bank Annual report, Colombo.

[3] Miskin T. (1993) Sri Lanka-a History of Growth, Building Economist, July, 13-14.

[4] Perera, B.A.K.S et al.(2007) ‘Quantity Surveyor As The Technical Appraiser In The Sri Lankan Financial Industry’, Built Environment Education Annual Conference (BEECON 2007), University of Westminster, Central London, Sep 2007.

[5] Rameezdeen, R. and Jeyamathan, J. (2006) Skills and Competencies of Quantity Surveyors: The case of Sri Lanka. In: Rameezdeen, R. & Seneviratne, I., ed. Customizing the Quantity Surveyor to Face Challenges in Year 2020, 26 January 2006 Colombo. University of Moratuwa: Department of Building Economics, 9-18.

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[6] TVEC (2005), Labour Market Information Bulletin. Colombo: Nipunatha Piyasa.

[7] Wirepa S. (2001), The future of the Quantity Surveying, Building Economics, March, 12-15.

[8] Zainudeen, N et al. (2006).Career paths in Quantity Surveying. In: R. Rameezdeen and I. Seneviratne. Customizing the Quantity Surveying to face challenges in year 2020, Colombo 26 January 2006.colombo: university of Moratuwa, Department of building economics, 43-56.

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