The Construction Industry’s Costliest Mistake—And How to Avoid It

If there’s one mistake that’s quietly draining profits in the construction industry, it’s manual data entry.

Every time your team rekeys payroll hours, codes invoices by hand, or tracks job costs in spreadsheets, you’re not just wasting time—you’re racking up costly errors, payroll miscalculations, and payment delays.

The worst part? Most construction companies don’t even realize how much it’s costing them. But there’s good news: this mistake is 100% avoidable with the right tools.

So what’s the real cost of manual processes? And how can you fix them? Let’s break it down.

The Hidden Costs of Manual Data Entry in Construction

1. You’re Paying for Human Errors—Literally

Construction payroll is complicated. Employees clock in and out at different job sites, work varying hours, and get paid different rates based on contracts, overtime, and union agreements. When someone misreads a handwritten timesheet or mistypes a number in a spreadsheet, it creates a payroll error that needs fixing.

The American Payroll Association (APA) reports that errors in manual time tracking can cost businesses 1% to 8% of total payroll costs. If you run $5 million in annual payroll, that’s up to $400,000 lost every year.

Mistakes in Accounts Payable are just as costly. A misplaced decimal or incorrect invoice coding can lead to overpayments, duplicate payments, or missed early-payment discounts. The Institute of Finance & Management (IOFM) found that manually processing invoices has an average error rate of 1.5%, which can cost a construction company tens of thousands of dollars per year.

2. You’re Burning Hours on Data Entry

How many hours does your team spend on payroll and AP every week? If you’re entering employee time manually or processing stacks of invoices, the answer is: too many.

A study by the Construction Financial Management Association (CFMA) found that construction payroll teams spend up to 20 hours per week correcting payroll errors and re-entering data. That’s over 1,000 hours per year—the equivalent of half a full-time salary wasted on fixing preventable mistakes.

Accounts payable isn’t much better. According to Ardent Partners, manually processing an invoice takes an average of 8.6 days and costs $15 to $40 per invoice. If you process 500 invoices a month, that’s up to $240,000 per year just on invoice handling costs.

3. You’re Losing Visibility into Your Costs

When payroll and AP data are stuck in spreadsheets, it’s hard to get a clear picture of job costs, cash flow, and profitability. Delays in processing payroll and invoices mean you’re making financial decisions based on outdated numbers.

Without real-time data, you don’t know:

• If labor costs are creeping over budget
• If you’re paying vendors late (and racking up late fees)
• If you’re missing early-payment discounts
• If your AP backlog is growing

By the time you catch these issues, it’s too late.

4. Late Payments = Unhappy Vendors (and Credit Issues)

Construction companies rely on vendors for materials, equipment, and subcontracted labor. But if your AP process is slow, you risk missing due dates and damaging vendor relationships.

Dodge Construction Network reports that the average construction firm takes 83 days to pay invoices—well beyond the typical 30-day terms most vendors expect. Late payments mean late fees, strained relationships, and potential credit issues that can impact future projects.

How Automation Fixes These Costly Problems

Construction companies are ditching manual data entry for automated solutions—and for good reason. Automation eliminates errors, speeds up approvals, and gives you real-time financial visibility.

1. Payroll Automation Saves Time and Reduces Errors

Instead of relying on paper timesheets and spreadsheets, automated payroll solutions let employees clock in and out using mobile apps, kiosks, or GPS-tracked time entries. The system automatically calculates hours, applies job codes, and syncs directly with your accounting software.

The result?

• Up to 70% less time spent on payroll processing
• Fewer payroll errors (so no more chasing down missing timesheets or fixing incorrect paychecks)
• Better compliance with overtime and union rules

2. AP Automation Speeds Up Invoice Approvals

With AP automation, invoices are scanned, coded, and routed for approval in minutes—not days. The system pulls vendor information, matches invoices to purchase orders, and ensures that payments are made on time.

Benefits include:

• Invoices processed in hours instead of days
• Lower processing costs (from $15 per invoice to as low as $2)
• Automatic flagging of duplicate or incorrect invoices

3. Real-Time Data Gives You Control Over Costs

Automation doesn’t just speed things up—it gives you instant access to labor costs, AP, and job expenses in real time. That means you can:

• Track payroll costs before they impact your bottom line
• See which invoices are pending, approved, or overdue
• Make smarter, faster financial decisions

How hh2 Eliminates Manual Data Entry for Construction Companies

hh2’s cloud-based solutions help construction teams streamline payroll, accounts payable, and job costing—without manual data entry.

1. Remote Payroll: No More Paper Timesheets

hh2’s Remote Payroll lets field crews submit time from anywhere using a mobile app, web browser, or kiosk. Supervisors can approve hours on the spot, and data syncs directly to your accounting system—no spreadsheets, no duplicate entry.

• Reduces payroll processing time by 70%
• Eliminates duplicate entry and manual calculations
• Ensures compliance with union rules, certified payroll, and job cost tracking

2. Document Flow: AP Automation That Works for Construction

hh2’s Document Flow automates AP from invoice capture to payment approval. Invoices are scanned, coded, and routed electronically—so you always know where they stand.

• Cuts AP processing time from days to hours
• Reduces invoice errors and overpayments
• Improves vendor relationships with faster payments

3. Seamless Integration with Your ERP

hh2 integrates directly with Sage 300 CRE, Sage 100, Viewpoint Vista, Foundation, and other leading construction accounting systems. No rekeying, no data silos—just real-time financial visibility across payroll, AP, and job costing.

The Bottom Line

Manual data entry isn’t just annoying—it’s costing your construction company thousands of dollars every year in errors, delays, and inefficiencies.

Automation eliminates these problems by:

• Reducing payroll and AP processing time by up to 70%
• Eliminating manual errors that cost thousands in payroll mistakes and overpayments
• Giving you real-time control over labor costs, job expenses, and vendor payments

hh2 makes it easy to automate your construction back office—so you can focus on building projects, not fixing spreadsheets.

Want to see how hh2 can save you time and money? Schedule a demo today.