Construction Estimating: Quantity Takeoff, Unit Costs and Markups

NCEES FE Civil spec: Construction Engineering, D. Construction estimating. FE Reference Handbook: Not a formula topic; Engineering Economics chapter for cost indexes and Mathematics chapter for volumes.

What the FE Civil Spec Covers

Subtopic D, construction estimating, asks you to turn quantities into costs. Typical questions are a quick quantity takeoff (concrete, excavation, formwork area), a crew cost from labor rates and productivity, a markup calculation, or a cost index adjustment. The arithmetic is simple; the traps are units and the order in which markups are applied.

Key Concepts

Estimate types

Order of magnitude: cost per unit of capacity (per bed, per lane mile, per MGD). Used for feasibility.
Square foot or cubic foot: cost per unit of building area or volume from similar projects.
Assembly (systems): priced building systems such as a wall assembly per square foot.
Detailed (unit price): full quantity takeoff, each item priced with labor, material and equipment. Used for bids.

Cost structure

Direct costs are labor, material, equipment and subcontracts tied to work items. Indirect costs are field overhead (supervision, temporary facilities, insurance, bonds) and home office overhead. Contingency covers known unknowns, and profit is the contractor's margin. Material quantities usually include a waste factor; labor is priced on the neat (installed) quantity.

Crew rates

A crew rate is the sum of hourly costs for every worker (and often equipment) in the crew. Divide the work quantity by crew productivity to get crew-hours, then multiply by the crew rate.

Core Formulas

Material cost = (neat quantity) (1 + waste) (unit cost)

Labor cost = \frac{quantity}{productivity} \times (crew rate)

C_{now} = C_{then} \frac{I _{now}}{I _{then}} C_{2} = C_{1} (\frac{Q _{2}}{Q _{1}})^{n}, n \approx 0.6

Concrete volume in cubic yards from feet: $V_{CY} = \frac{L \cdot W \cdot t}{27}$ .

Where It Is in the FE Reference Handbook

The handbook has no estimating section. Use the Mathematics chapter (mensuration of areas and volumes) for takeoff geometry, the Engineering Economics chapter for cost terms and time value of money, and the Units and Conversion Factors pages for cubic feet to cubic yards. Everything else must come from your own process.

Worked Example: Slab on Grade Estimate

Estimate a 60 ft by 40 ft slab on grade, 6 in thick. Ready-mix concrete costs $165/CY with 5% waste. The placing crew is one foreman at $48/hr and four laborers at $34/hr, and it places 8 CY of neat volume per crew hour. A concrete pump costs a flat $1,200. Add 10% overhead on direct cost, then 8% profit on the subtotal.

Step 1: neat volume.

V = \frac{( 60 ) ( 40 ) ( 0.5 )}{27} = \frac{1 , 200 ft ^{3}}{27} = 44.44 CY

Step 2: material.

(44.44) (1.05) = 46.67 CY (46.67) ($165) = $7, 700

Step 3: labor.

Crew rate = 48 + 4 (34) = $184/ hr \frac{44.44}{8} = 5.56 crew-hr (5.56) (184) = $1, 022

Step 4: direct cost and markups.

Direct = 7, 700 + 1, 022 + 1, 200 = $9, 922

With overhead = 9, 922 (1.10) = $10, 914 Bid = 10, 914 (1.08) = $11, 787

Cost index check: a similar project cost $2.4 million when the index was 1150. With the index now at 1380, the updated cost is $2.4 (1380/1150) = $2.88$ million.

Exam Tips

Read whether a percentage applies to direct cost, to the subtotal after overhead, or to the total bid. The same 10% markup gives different answers depending on its base. When a problem gives labor productivity in units per labor-hour, divide by the crew size before multiplying by individual wage rates, or convert to a crew-hour basis first. Keep quantities unrounded until the final dollar figure; rounding 44.44 CY to 44 CY early shifts the bid by about 1%.

Common Mistakes

Forgetting to divide cubic feet by 27, or using inches for slab thickness.
Applying the waste factor to labor hours as well as to material.
Adding markups as a single combined percentage when the problem compounds them (10% then 8% is 18.8%, not 18%).
Pricing one worker instead of the whole crew when productivity is given in crew-hours.
Inverting the cost index ratio when bringing an old cost forward.

Practice Problems

Try these from the free PolyCalc FE Civil problem bank. Each one has a full worked solution.

A project uses 500 m³ of material at $25 per m³. What is the total direct material cost? See the worked solution or practice the Construction & Scheduling deck
A crew places reinforcing steel at a productivity of 8 crew-hours per ton. The crew consists of one foreman at $45 per hour and three workers at $28 per hour, with a labour burden of 55%. The total labour cost to place 60 tons is most nearly: See the worked solution or practice the Construction & Scheduling deck
A foundation consists of a 25 m × 40 m slab on grade 150 mm thick, plus eight isolated footings each 2.5 m × 2.5 m × 0.6 m deep. Neglecting waste, the total volume of concrete required is most nearly: See the worked solution or practice the Construction & Scheduling deck
Four workers each work 8 hours and together install 64 m². What is their productivity in square meters per labor-hour? See the worked solution or practice the Construction & Scheduling deck

Related Calculators and Examples

Frequently Asked Questions

What are the main types of construction cost estimates?

From least to most detailed: order of magnitude (conceptual) estimates from cost per unit of capacity, square foot or cubic foot estimates, assembly or systems estimates, and detailed unit price estimates built from a full quantity takeoff. Accuracy improves as design progresses.

Is overhead a direct or indirect cost?

Indirect. Direct costs are labor, material, equipment and subcontracts that go into specific work items. Field overhead (supervision, trailers, temporary utilities) and home office overhead are indirect costs added on top, followed by profit.

How do I adjust an old cost to today?

Multiply the historical cost by the ratio of the current cost index to the index at the time of the old cost. For a different size facility, also apply a capacity factor, typically the size ratio raised to a power around 0.6.

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