Economic Benefits of Lightweight versus Conventional Construction Methods

This paper offers an economic comparison between two construction methods, lightweight and conventional. The first aspects to be compared are the initial and life-cycle ( LC ) costs. Due to the infrequency of lightweight construction in Israel before the beginning of this decade, and the consequent uncertainty regarding its cost-related data, the lightweight method was examined in three different ways. It is shown that costs are relatively similar for the two methods. The influence of the duration of construction is investigated next. The shorter time requirement of the lightweight method enables the construction industry to provide more housing solutions at a faster rate; this paper presents a simplified, yet sufficiently accurate, assessment of this quantitative advantage, which comprises three elements: the benefit accruing from early exploitation of the facility, saving in time-dependent site overhead expenses, and the capital cost of a faster cash outflow. It is shown that, subject to various assumptions, the net benefit of the shorter construction period is 3%–9% of its initial cost, or 2%–6% of the LC cost. The influence of the lower man-hour input is also investigated against the background of the 30,000–40,000 labor shortage forecast for this decade in Israel. It is shown that the advantage of the lightweight method versus the conventional one increases with wage escalation. The influence of the lower man-hour input on the industry's output potential, and the ability to compensate for labor shortage are also discussed.