(650) 332-8623Construction Time Tracking vs Job Costing: What’s the Difference?
Compare construction time tracking with job costing to see how verified hours and GPS data improve payroll accuracy and job budgets.
TL;DR
Construction time tracking captures verified labor hours tied to specific jobsites, tasks, and cost codes, while job costing calculates the total financial cost of a project by combining those labor hours with materials, equipment, and overhead. Time tracking is the foundation; job costing is the financial analysis built on top of it. Accurate time tracking is essential for reliable job costing because labor represents the largest and most variable expense on any construction project.
Time tracking and job costing sound similar, but they solve two different problems on a construction site. The former captures labor hours. The latter turns those hours (plus materials, equipment, and overhead) into the real cost of a job.
When you compare construction time tracking with job costing, you’ll see that accurate hour collection is the starting point for every reliable cost report. For contractors, construction time tracking software makes this easier. They gain a cleaner baseline for payroll, labor burn, and cost allocation, making the downstream job cost report far more accurate.
So, let’s discuss construction time tracking, job costing, and why you need both for reliable budgets and predictable project margins.
Key takeaways:
- Time tracking records verified labor hours and ties them to the correct jobsite, task, and cost code.
- Job costing calculates the financial impact of those hours along with materials, equipment, and overhead.
- Job costing is only as accurate as the labor hours feeding it.
What is construction time tracking?
Construction time tracking means recording verified labor hours tied to the specific jobsite, task, or cost code where the work happened. It replaces handwritten timecards and memory-based reporting with exact timestamps, jobsite location data, and clear task assignments. For example, Workyard uses GPS-verified location tracking to automatically capture exact entry and exit times across every jobsite, eliminating the manual entry and payroll disputes common with paper timecards or honor-system apps.
Because crews move between sites, switch tasks multiple times, and often work irregular hours, construction time tracking must capture more than a simple clock-in and clock-out.
It needs to document:
- the exact start and end time for each shift
- the jobsite where the worker was located
- the task or cost code tied to each block of work
- travel time between jobs
- breaks and overtime
- multi-site days and job-switch activity
Accurate time tracking
- gives payroll clean hours,
- gives PMs real visibility into labor burn, and
- reduces the corrections and disputes that come from end-of-week guesswork.
What is job costing in construction?
Job costing means calculating the total cost of a project by adding up labor, materials, equipment, subcontractors, and overhead. It gives contractors a clear picture of
- how much each phase of work actually costs and
- how those costs compare to the budget.
Labor is the most variable and error-prone part of any project, so job costing depends heavily on accurate time tracking. If hours are rounded, mis-coded, or tied to the wrong phase, the cost data becomes unreliable and PMs lose visibility into labor burn.
Clean job costing allows teams to
- track budget vs. actual,
- spot overruns early, and
- make adjustments before the project drifts too far off course.
Key differences between time tracking and job costing
Time tracking and job costing are connected, but they serve different purposes. Time tracking captures verified labor hours in the field, while job costing turns those hours (along with materials and equipment) into the financial picture of a job.
Category | Construction time tracking | Job costing |
Purpose | Record verified labor hours | Calculate total project cost and profitability |
Data captured | Timestamps, GPS location, job codes, travel | Labor cost, materials, equipment, overhead |
Primary users | Crews, foremen, payroll | PMs, accounting, owners |
Output | Exact hours by job and task | Budget vs. actual cost visibility |
Dependency | None | Depends on accurate time tracking |
When time tracking is inaccurate, job costing becomes unreliable. Correct hours are the baseline for every financial calculation that follows.
How time tracking and job costing work together
Time tracking and job costing feed directly into each other. Verified hours from the field become the labor cost inside job costing. So PMs get a real view of how a project is tracking against the budget. When the data is accurate, cost reports reflect what’s actually happening on site; when it isn’t, overruns surface late.
A typical workflow looks like this:
- A worker clocks in with a verified timestamp and job site location.
- Hours are assigned to the correct job and cost code throughout the day.
- Payroll receives clean, verified hours without manual edits.
- Job costing converts those hours into labor dollars for each phase.
- PMs track labor burn and compare actual hours to the estimate in real time.
Numerical example
Even small inaccuracies add up fast. If each worker adds just 10 extra minutes per day, a 20-person crew quietly generates 200 minutes of unearned time. At an average small-business wage of $30.42/hour, that’s more than $100/day, or roughly $2,000/month in preventable labor cost.
This is why field teams that rely on paper timecards or late entries often struggle with unpredictable job costs; small timing errors multiply into meaningful swings in labor burn.
Why construction companies need both time tracking and job costing
Construction companies need both time tracking and job costing because labor is the largest and most variable expense on any job. Time tracking provides verified hours tied to the right jobsite and task; job costing converts those hours into labor cost so PMs can see whether each phase is staying on budget.
Why both systems matter:
- Accurate time tracking gives contractors clean, verified hours for payroll.
- Reliable job costing depends on those clean hours to calculate true labor cost.
- PMs get real visibility into labor burn when both systems are aligned.
- Billing stays correct on time-and-materials work when hours map to the right task.
- Multi-phase jobs become easier to forecast with accurate historical labor data.
- Overruns are caught earlier because labor trends show up in real time.
- Reporting to GCs or owners becomes clearer when cost codes and hours match field activity.
- Disputes over hours or tasks drop because the data is verified and consistent.
Accurate time tracking also helps in reducing wage theft and buddy punching, and even padded hours, which directly protects labor costs.
Learn how verified GPS timestamps flow directly into Workyard’s job costing workflows
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Common problems when time tracking and job costing don’t line up
When time tracking is inaccurate or incomplete, job costing becomes unreliable immediately. Hours drift, cost codes break, and PMs lose visibility into how a job is actually performing. Most issues come from manual entry, late timesheets, or crews moving between sites without capturing task changes.
Typical problems contractors run into:
- Rounded or padded hours that inflate labor cost.
- Missing job switches because crews forget to change cost codes.
- Incorrect task or phase-coding, which distorts labor burn reports.
- Travel time that’s guessed or added later, making multi-site days unreliable.
- Foremen fixing hours from memory, creating inconsistent data across the week.
- One block of hours recorded for multiple sites, even when the crew moved.
- PMs discovering overruns late, because data doesn’t reflect real field activity.
These issues compound when teams rely on too many tools. Research shows 28% of small business owners waste time waiting for updates across tools, and 29% repeat information across platforms, the same friction crews face when hours and cost codes live in disconnected systems.
Best practices for connecting time tracking and job costing
The most reliable job-cost reports come from crews who track hours accurately, switch tasks when the work changes, and capture movement between sites. The goal is simple: clean labor data in the field produces clean cost data in the office.
Key practices contractors use:
- Use GPS-verified timestamps to capture exact start, stop, and location. For instance, Workyard’s GPS breadcrumb tracking records location points throughout the day, showing exactly where crews traveled and how long they spent at each stop—eliminating the guesswork that comes from memory-based time entry.
- Require job and task coding at the time of work, not during end-of-week cleanup.
- Prompt crews to switch tasks when moving between phases or sites.
- Track travel time automatically so multi-site days aren’t estimated.
- Review hours daily, while details are still fresh and corrections are quick.
- Give PMs real-time access to labor burn, not weekly updates.
- Use tools that send hours directly into job costing to avoid manual consolidation.
When equipment use changes with task changes, pairing labor tracking with construction time tracking with equipment hours improves job-cost accuracy even further.
Clean labor data protects margin, reduces correction cycles, and gives PMs cost information they can actually act on.
See how Workyard applies these practices with GPS-based task tracking and automatic job-code accuracy.
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How Workyard ties time tracking and job costing together
Workyard is a GPS time tracking and job costing platform built for construction and field teams who move across multiple job sites. It captures exact entry and exit times, travel routes, and job or task switches using real-time GPS, so hours reflect where work actually took place. The app works even on low-signal or remote sites, giving crews a simple way to record accurate hours while giving the office verified data they can trust.
How this improves job costing:
- Exact timestamps reduce rounding and padding.
- Job-switch reminders prevent incorrect cost codes and phase drift.
- GPS breadcrumb tracking resolves travel-time disputes.
- Multi-site days are captured accurately as workers move between locations.
- Offline mode ensures hours are recorded even without cell service.
- Verified hours flow directly into job costing so PMs can track labor burn in real time.
If a worker starts the morning on a concrete pour at Site A, moves to Site B for cleanup, and ends the day hauling material to Site C, Workyard logs each arrival, departure, and task switch with GPS precision. This helps contractors maintain cleaner attendance data, which supports both payroll and labor cost accuracy.
See how Workyard captures accurate hours for crews on the move.
Time tracking records verified labor hours tied to specific jobsites and cost codes. Job costing uses those hours, along with materials, equipment, and overhead, to calculate the total cost of each phase of work. Contractors need both because cost data depends on accurate hours.
Labor is the largest and most variable expense on most projects. If hours are rounded, mis-coded, or delayed, the cost data becomes unreliable and PMs lose visibility into labor burn. This is why many contractors move to GPS-backed systems such as Workyard.
GPS timestamps confirm a worker’s location at clock-in, clock-out, and throughout the day. This reduces errors like off-site punches and missing job switches, which helps maintain clean cost codes. Workyard logs each arrival and departure using real-time GPS, not geofencing, which improves accuracy even on multi-site days.
Yes. When hours, job codes, and travel time are captured correctly and flow directly into cost reporting. This reduces manual consolidation and removes the guesswork that comes with paper timecards or spreadsheets.
If crews move between jobsites without switching tasks or recording travel time, hours end up allocated incorrectly. GPS-based tools capture these transitions automatically, so labor cost matches actual field activity. This becomes even more important for workflows involving equipment-hour tracking, such as in construction time tracking with equipment hours.
Contractors typically rely on daily timesheet reviews, GPS verification, and task-switch prompts to keep labor data accurate. Many also use checks for buddy punching or padded hours, similar to the controls covered in our guide on reducing wage theft and buddy punching.
Time tracking provides verified labor hours, including clock-in and clock-out timestamps, jobsite locations, task or cost code assignments, break durations, and travel time between sites. Job costing requires all of this labor data plus materials, equipment usage, subcontractor expenses, and overhead allocations.
The labor component is where most inaccuracies occur because it depends on real-time field data. Time tracking captures the “who, when, and where” of labor; job costing converts that into the “how much” by applying wage rates, burden costs, and allocating those dollars to specific project phases. Without accurate time tracking feeding clean hours into job costing, the financial picture becomes unreliable.
Cost codes and job phases are the bridge that connects raw labor hours to financial reporting. When crews track time, they assign each block of hours to a specific cost code that represents a task type (like “framing” or “site prep”) and a job phase that represents where in the project timeline that work falls.
Job costing systems then aggregate these coded hours and apply labor rates to calculate the actual cost per phase. If cost codes are missing, inconsistent, or assigned incorrectly, job costing reports show labor in the wrong buckets—making it impossible to compare budgeted versus actual costs at the phase level. This is why platforms like Workyard prompt crews to select the correct job and cost code when they clock in or swit
Every manual edit or approval step introduces the potential for error or delay. When foremen adjust hours from memory at the end of the week, they often round times, miss task switches, or assign hours to the wrong cost code. These corrections may fix payroll, but they distort job costing because the adjusted data no longer reflects actual field activity.
The best practice is to capture accurate data at the source—using GPS-verified timestamps that require minimal editing—and implement same-day review cycles so corrections happen while details are fresh. Approval workflows should flag anomalies (like unusually long shifts or missing cost codes) rather than require blanket review of every timecard. This reduces administrative burden while preserving data integrity for job costing.
Job costs should be reviewed at least weekly, though daily monitoring is ideal for projects with tight margins or aggressive timelines. Weekly reviews allow PMs to spot labor burn trends before they become serious overruns; daily reviews catch problems in real time when corrections are still possible.
The review frequency also depends on project duration. For a two-week punch list, daily checks matter. For a six-month build, weekly reviews with monthly deep dives may suffice. What matters most is that the time tracking data feeding those reviews is accurate and current. If hours are only finalized at week’s end, daily job cost reviews have no value. Workyard’s real-time dashboards give PMs labor burn visibility as hours are logged, enabling meaningful daily monitoring without waiting for timecard approvals.
The best tools for combining time tracking and job costing are purpose-built platforms that capture GPS-verified hours and flow them directly into cost reporting without manual exports or data entry. Generic time clocks or spreadsheet-based systems typically lack the construction-specific features needed to handle multi-site days, cost code assignments, and travel time tracking.
Workyard is built specifically for this workflow. It captures exact entry and exit times using real-time GPS, prompts crews to assign jobs and cost codes, tracks travel between sites automatically, and pushes verified hours directly into job costing reports. The platform also integrates with QuickBooks, Sage, and other accounting systems, so labor dollars flow into financial reporting without CSV wrangling or double-entry.
Keeping time tracking and job costing in separate systems may make sense for very small contractors (one to three employees) who can manage payroll and costs manually, or for companies locked into legacy accounting systems that can’t accept automated data feeds. In these cases, the overhead of implementing an integrated platform may outweigh the benefits.
However, for any company running multiple crews across multiple jobsites, the integration benefits almost always outweigh the costs. Separate systems require manual data transfer, which introduces errors and delays. The labor hours captured in time tracking must be re-entered or exported into job costing, creating extra admin work and data integrity risks. Most contractors find that unifying both functions in a single platform—like Workyard—saves more in admin time and error correction than the software costs.
