The Impact of Safety on Profitability
Safety is vital in the construction world. Since contractors have to handle dangerous tools, heavy machinery and scale large projects every single day, it’s no wonder that construction sites are subject to such strict safety regulations. From hard hats to safety gloves and harnesses, smart foremen take extra precautions to keep workers safe on the job.
These safety precautions are not only important because of the dangers of working in construction, however. Staying safe on your worksite is also important to a construction company’s profitability. An injured worker can cost your construction company in multiple ways, including:
- Paying workers’ compensation insurance
- Potential lawsuits
- Lower productivity
- Low morale among other workers
- Poor reputation in the media and within the industry
To combat these consequences, you should invest in safe materials and tools for your construction worksites.
MCAA Smart Solutions
The Mechanical Contractors Association of America (MCAA) released a report in the winter of 2016 on the importance of investing in workplace safety. According to the MCAA, you should invest in workplace safety for the following reasons:
- Poor safety leads to low efficiency
- Accidents can make your insurance costs skyrocket
- You receive fewer bidding opportunities for major projects
Implementing safety regulations, however, can reverse these effects. According to a study by the Construction Industry Work Force Foundation, the implementation of safety training on worksites resulted in:
- 17% productivity increase
- 9% decrease in turnover and absent workers
- A decrease in low worker morale
How Safety Can Improve Your Bottom Line
Having a safer workplace makes your construction company a better place to work and a better team to hire. With efficient, productive workers and low injury-related costs, you can turn a greater profit. This is because your employees are working faster and harder with the right tools and knowledge necessary to get the job done safely.
This money-saving strategy is most evident in insurance costs. According to the MCAA, insurance companies calculate your premiums based on the Experience Modification Factor (E-Mod). A higher E-Mod indicates a less safe workplace and therefore, insurance companies require a higher monthly premium.
- A company with an E-Mod of 1 might have a premium of $200,000
- A 0.8 E-Mod company might have a $160,000 premium – saving $40,000
- A 1.4 E-Mod company might have a $280,000 premium – spending an extra $80,000
Another way to examine profitability and safety is to look at direct payouts. The more injured workers you have, the higher medical and compensation costs will be. That’s money from the company’s profits that you are spending on preventable accidents. Simply put, better safety equals lower costs.
Recommended HoldRite Products
To improve your company’s profitability, choose HoldRite Products that promote safety, project management, and profitability. HoldRite Products not only save valuable time but also labor on the job. This is because HoldRite provides professional solutions to makeshift construction methods, which could be dangerous. This saves the project manager more money in the long run, improving project profitability.
Choose the following HoldRite Products for maximum profitability and workplace safety: