Hội nghị Khoa học kỷ niệm 50 năm ngày thành lập Viện KHCN Xây dựng

CONSTRUCTION COST AND TECHNOLOGY CHOICE:

AN INTERNATIONAL COMPARISON

Toong Khuan CHAN*

ABSRACT: Building economists have produced construction cost indices to allow for a comparison of
building construction costs for many countries but these indices do not take into account or optimizes the
choice of materials or technology used in the construction process. The aim of this project is therefore to
develop new construction cost indices which are linked to the various methods of building construction.
The differences in local practices, availability of local resources (raw materials, land, labour, capital and
technology), domestic building materials industries, and local regulations all combine to influence the
construction cost of a building. These new indices are derived from a global survey of the costs of
building material, construction costs for various building elements, labour costs, capital costs together
with the choice of construction method and technology employed. The findings will inform on many
current research and policy initiatives: to manage the exploitation of indigenous resources, to develop
domestic building materials industries, to improve construction methods, modernise and upgrade the
construction sector in developing countries.

1 INTRODUCTION
Construction technology is commonly understood as the choice of construction materials and the
processes through which these are assembled to produce a building or a structure. The use of
locally grown timber or stone quarried from a nearby location for residential housing is one
example of material selection through the utilisation of native materials. Very often the skills of
the local labour are closely matched with the type of material that is most commonly available.
This simple and efficient selection of materials and construction technology has served to
provide buildings for many centuries. Modern construction methods now offer the builder a
number of options for a building system with a wider selection of materials, some of which may
be procured from overseas. The choice of construction technology is influenced by many factors
but from a building economist’s point of view the total cost is the most rational criteria for
evaluating alternatives. Other factors that may influence the choice of material and technology
include design preferences, availability of construction materials, exposure to hazards and risks,
speed of construction, climate, indoor comfort and energy efficiency, social cultural acceptance
and appropriateness, environmental impact (demolition, recycling, etc.), availability of local
skills and opportunities for participation of livelihoods. It may be argued that these other factors
will ultimately translate into costs in one form or the other in the market.

*
Toong Khuan CHAN, Faculty of Architecture, Building and Planning, The University of Melbourne,
Victoria 3010, AUSTRALIA

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Fundamentally, the construction cost will comprise the cost of the raw materials, the labour to
shape and assemble these materials, the purchase (or rental) of tools, machineries and other
construction equipment, overheads (management, head office, compliance with all regulations,
fees, and insurances) and finally the builder’s profit. Builders may choose to adopt local
construction methods and materials that are durable and inexpensive to maintain reduce the
maintenance and life cycle cost of buildings. However, it is also possible that investments in new
technologies may reduce the costs of construction in the long run when the technology becomes
widely accepted locally. Modern construction methods employ various elements or sub-
assemblies that may be fabricated elsewhere to reduce the physical work at the construction site.
For example, prefabricated building has become the least expensive and widely used technique
in the public housing sector of many developing countries while in other countries in-situ
construction remains the cheapest and most widely used (Warszawski, 1999). Multi-storey
buildings in Australia are predominantly constructed with concrete framed structures whereas the
US has a greater proportion of steel framed buildings. Many developing economies, faced with
increasing demand for building products and services, are faced with challenges to formulate
policies to advance their local construction industries in the most appropriate directions with
regards to construction materials and technologies. A careful choice of technology will have both
economic and social consequences.

Building economists have produced construction cost indices to allow for a comparison of
building construction costs for a wide range of locations, usually at major urban areas in
developed and developing countries. These indices are updated regularly to enable building
owners, contractors and investors to estimate the cost of an equivalent building on a per square
meter basis. This method of computing construction costs, either in local currency (Davis
Langdon, 2010), or adjusted using a purchasing power parity approach provides a reasonably
accurate description of the cost relativities between countries (McCarthy, 2011). Existing indices
often do not link cost with other important local conditions such as dominant technology used
locally. In effect, the sole focus on per square meter building costs ignores the different
construction methods or technologies employed to construct these buildings. Thus, the use of
these indices does not provide a complete insight into the reasons for the differences in
construction costs observed across countries and localities. While many previous studies (Davis
Langdon 2010, Stapel 2002, Walsh and Sawhney 2004) have made cost comparisons between
countries, relatively little or no study has linked total cost comparison to choice of construction
technology and industry specific conditions. Existing location indices are often constructed and
are specified without any indication of what construction technology is referred to for each
location represented by the indices.

Stakeholders in multinational projects need to understand the total cost of projects at the
feasibility stage and prior to bidding and construction. They require sufficient information that
can help them choose different construction technologies when planning projects in different
locations. Knowledge of differences in costs between locations accounted for by differences in

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technology can help stakeholders choose the most appropriate construction. On top of that, the
choice and investment in appropriate technology can facilitate and advance the development of
the local construction industry.

The aim of this project is therefore to develop a series of construction cost indices which are
linked to basic inputs that are available locally for the construction of a building. The differences
in local practices, availability of native resources (raw materials, land, labour, capital and
technology), domestic building materials industries, and local regulations all combine to
influence the construction cost of a building. These indices will be derived from a compilation of
the costs of building material, construction costs for various building elements, labour costs,
together with the choice of construction method and technology employed. The findings will
inform on many current research and policy initiatives: to manage the exploitation of indigenous
resources, to develop domestic building materials industries, to improve construction methods,
modernise and upgrade the construction sector in different countries. The findings should
provide a rational method for selecting an appropriate building technology to suit the conditions
of the construction industry in different countries. This is important as developing countries
continue to seek for ways of making construction products affordable as well as seek to
encourage the development of domestic construction industry.

2 BACKGROUNDS AND LITERATURE REVIEW

International construction economists (Stapel 2002, Walsh and Sawhney 2004, Best et.al 2010,
McCarthy 2011) are focused mainly on gathering data on construction costs in major cities
around the globe and conducting research to explain observed differences in these indices based
on the type of building; whether the building is to be used as a hotel, premium office tower, or an
industrial or manufacturing facility. The demand for these indices are driven mainly by investors
from developed countries looking to invest in major growth areas, or by manufacturers seeking
to relocate their operations to less expensive locations. On the other hand, local construction
activities are organised by managers sourcing building materials locally, employing local or
migrant labour, and selecting a method of construction that reflects the ability of the local
industry aim to achieve a lowest cost solution.

Sultan and Kajewski (2006) indicated that in some developing countries, the construction
industry is very dependent on the import of construction components and materials combined
with issues of high unemployment leading to high construction costs from imported materials,
inflation and an unstable economy. Thus policies put forward by various countries to improve
the economic performance of their respective construction industries need to be informed by a
precise economic model that illustrates the link between the cost of inputs to the construction
industry to the price of its outputs and its follow-on benefits to the national economy.

The insistence by many developing countries seeking to import expensive construction

technologies or use advanced products from overseas in their local construction sectors to
improve productivity or quality of their products may be misguided. Ganesan (2000) suggested
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that construction methods that provide greater employment be adopted in Sri Lanka to cater for
the under-employment of the labour force. Moavenzadeh (1978) found that designs by expatriate
professionals are often poorly suited to locally available labour, materials, equipment and
construction methods. Developing nations thus tend to rely rather heavily on aid from developed
countries in the professional sector of the industry. In the developed countries, increase in the
cost of labour relative to other inputs have led contractors to search for labour substitutes,
perhaps through the use of more productive equipment or a more capital-intensive method of
construction which reduces on-site labour requirements. It is very likely that the techniques
currently being developed in the industrialised countries may not be especially suitable for use in
developing countries due to their incompatibility with local conditions. Some older techniques
relying less on capital-intensive methods and more on labour, particularly unskilled and semi-
skilled labour, might be more appropriate.

3 METHODOLOGY

This project explores the use of basic construction material and labour cost indices to develop a
framework for evaluating the choice of construction technology. The proposed approach is based
on the structure of construction inputs and applied to evaluate the impact of changes in inputs on
the key trades of the building industry. The framework is used to map the technology choices to
various combinations of input cost indices in a number of developed and emerging economies.
The approach is to examine a number of countries with the availability of indigenous raw
materials, high and low labour costs, and to show the price developments of production factors
used in their respective construction industries.

Data for gross domestic product (GDP) per capita based on purchasing power parity (PPP) was
obtained from the World Bank’s world development indicators database for 2011 to correspond
with the year the cost survey was carried out (World Bank, 2013). GDP PPP is gross domestic
product converted to international dollars using purchasing power parity rates. The World Bank
defines an international dollar to have the same purchasing power over GDP as the U.S. dollar
has in the United States.

3.1 Compilation of Basic Prices

Construction cost data from sixteen countries (Australia, Canada, China, Germany, India,
Ireland, Japan, Malaysia, Russia, South Africa, South Korea, Singapore, United Arab Emirates,
United Kingdom, United States and Vietnam) was obtained from an international construction
cost survey conducted by Turner and Townsend (2012). This survey reported on materials and
labour costs across the many countries that the company operates in and includes a disclaimer to
point out that these prices are indicative and are dependent on building design, site conditions,
and may be subject to different interpretations, building methods and standards for costing and
measurement. However, this set of data provides useful and readily accessible prices for this
preliminary study.

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Although the survey included a large number of building materials and wide range of building
elements, the cost components studied were limited to skilled labour cost (calculated as an
average of skilled workers in three groups of trades), five basic material cost items (concrete,
reinforcing bars, standard bricks, steel sections and softwood timber for framing) and five key
elements in the building trades (concrete in slabs, reinforcement in beams, formwork to soffit of
slabs, structural steel beams, and precast concrete walls). These basic prices were converted to
ratios or indices by dividing the cost of each material with the hourly rate for skilled labour or
the cost of one cubic metre of concrete.

In this preliminary study, the investigation was limited to four concrete/steel construction
systems: cast-in-place reinforced concrete, precast concrete, pre-stressed concrete and structural
steel frame with a composite concrete-steel deck, to validate the research approach. Selecting a
range of developed and emerging economics will allow a comparative analysis of the differences
among and between groups of countries in terms of technology choice and its relationship with
regards to construction costs.

3.2 Case studies of construction systems

Three case studies were identified from existing literature to represent the various different
framing options for multi-storey construction: cast-in-place reinforced concrete, precast concrete,
prestressed concrete and structural steel frame with composite concrete-steel deck systems. The
purpose of these case studies was to demonstrate the use of these indices to rationalise the choice
of structural system in each location based on the cost of inputs.

The first case study conducted by Yong (2010) costed a cast-in-place reinforced concrete 2,405
square metre double-storey (and a single level basement) retail and office building, a precast
concrete 1,154 square metre double storey residential apartment, and a single post-tensioned
concrete slab in the upper floor of 1,122 square metres for an industrial building, all in
Melbourne, Australia. The analyses that were conducted by Yong include an estimation of
builder’s costs for the reinforced concrete, precast concrete and post-tensioned systems based on
cost data in Australia, UK, Malaysia and US.

The second case study referred to a comparative study by Mills (2009) who conducted cost
comparisons on six designs for a 10-storey building. A comparative evaluation of UK, German
and French builders by Proverbs et al (1999) provides data for the third case study. Using
questionnaire surveys of 31 UK, 13 French and 10 German builders,

4 ANALYSIS OF RESULTS

For operational and analytical purposes, the World Bank classifies economies based on gross
national income per capita into low income, middle income (subdivided into lower middle and
upper middle), or high income. Of the 16 countries examined, Singapore, US, UAE, Ireland,
Canada, Australia, Germany, UK, Japan, and South Korea were classified as high income with

45
Russia, Malaysia and South Africa in the upper middle income category, and China, India,
Vietnam in the lower middle income category. In an international comparison, the single most
important factor is usually the difference in labour cost across different countries. Figure 1 shows
the hourly wage rate for skilled workers in these countries in US dollars plotted together with
descending GDP per capital (PPP adjusted) for these 16 countries. As expected, the hourly
wages for skilled workers are significantly higher for the high income countries but lower for the
middle income countries. As the construction sector in Singapore and the UAE are heavily
reliant on the employment of migrant workers, the wage levels in these two countries are
depressed by the lower wages paid to these transient workers compared to the local nationals. A
similar depression of wage is evident in Malaysia where a large proportion of the construction
labour is from either Indonesia or Bangladesh. As a country with the lowest GDP per capita,
Vietnam exhibits a much higher wage level compared to other lower middle income (LMI)
countries indicating that construction wage levels are rising faster than the economy in general.
The cost of one cubic metre of 30MPa concrete ranges from a low of US$55 in Vietnam to a
maximum of US$191 in Australia. A plot of the concrete costs against the level of economic
development in Figure 2 does not indicate that concrete is cheaper in a middle income economy.

The effect of different currencies can be eliminated if basic materials such as concrete, brick,
timber, reinforcements and structural are divided by the hour wage of the skilled workers (see
Table 1, Figures 3 and 4). A cubic metre of concrete is now equivalent to 2.8 hours of wages in
the high income countries if we disregard Singapore and UAE. Concrete is valued at between 7
to 8 hours of wages for Singapore and UAE, but increases rapidly as GDP per capita reduces.
Indian concrete is very expensive at 104 times the hourly wage. Similar trends can be seen for
bricks and timber. Reinforcing bars and structural steel are equivalent to 21 hours and 40 hours
of wages respectively for high income countries. The lower cost of labour in Singapore and UAE
distorts the relative cost of steel in these two countries leading to ratios more aligned to the
middle income countries. Steel is relatively expensive in the upper middle and lower middle
income countries. The extremely low wage in India leads to very high relative cost of both
reinforcing bars and structural steel there with ratios exceeding 800 for a tonne of reinforcing
bars and 1000 for a tonne of structural steel. The ratios for Vietnam clearly indicate that its
higher wage level has reduced the relative cost of construction materials to the same order as
higher middle income nations.

Similarly, the cost of basic construction materials is divided by the cost of one cubic metre of
concrete Table 1. Bricks are generally more expensive relative to concrete in the high income
countries but cheaper in the middle income countries. This observation may lend itself to the
wider use of brick in buildings in the middle income countries where the cost 1000 bricks is one
or two times more than one cubic metre of concrete.

The cost relativities of reinforcing bars and structural steel with concrete are shown in Table 1.
The cost for one tonne of reinforcing steel is between 5 to 15 times the costs of one cubic metre
concrete for all the countries examined. No clear trend was observed relative to the level of
46
income for these countries. But the examination of the cost of structural steel, countries such as
the US, Japan, Russia and India have very low cost relative to concrete. This observation may
account for the higher prevalence of steel structures in these countries compared to reinforced
concrete frames.

The cost of a cubic metre of concrete in a reinforced concrete slab is the sum of the material and
labour costs plus an allowance for wastage. A comparison of the total concrete element cost and
formwork cost in terms of equivalent labour is also tabulated. One cubic metre of concrete in a
slab is equivalent to approximately 3.4 hours of wages in the high income economies (excluding
Singapore and the UAE) whilst the ratio increases to 16 for the upper middle income and 57 for
the lower middle income countries. This observation reinforces the earlier finding that concrete
as a material is cheap relative to labour in high income countries but significantly more
expensive in lower wage economies.

The utilisation of timber formwork is examined next. One square metre of timber formwork to
the soffit of a slab is equivalent to 1.3 hours wages in the high income nations, but increased to
5.5 for the lower middle income nations. This small increase in the relative cost of timber
formwork seems to suggest that formwork, although more expensive in the middle income
nations, is not as prohibitively expensive as other materials.

4.1 Case Studies for Construction Systems

Yong (2010) determined that when the projects were priced with local Melbourne rates, the
materials consist of 50% of the total structural costs with labour and plant at 45% and 5%,
respectively. The material, labour and plant split for the UK and the US remained at
approximately 43%-46%-11% and 45%-54%-1%, respectively. Pricing the same project in upper
middle income Malaysia with rates obtained from a builder resulted in a lower proportion for
labour at 22% with a corresponding material component at 72%. A detailed examination of these
labour components indicates that labour intensive activities such as the installation and
dismantling of formwork comprise a large proportion of the labour costs. It is not surprising that
numerous innovative systems of precast concrete elements or lost formwork systems have been
developed to reduce the utilisation of timber forms in reinforced concrete works in high income
countries. Given that labour constitutes only 22% of the total structure works there is little
incentive to employ more productive methods of construction.

A comparison of cast-in-place reinforced concrete with a precast concrete system in Australia is

shown in Table 2. The cost for the cast-in-place system was the more economical compared to
the precast system which was 9% more expensive. The precast material cost had increased to
AUD 207 due to higher manufacturing and transportation costs for the precast elements, but
there was a consequential reduction in onsite labour costs for the assembly of these elements.
The need for a larger capacity crane for the assembly of the precast elements increased the
equipment cost.

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 Table 2: Unit cost (per square metre) of concrete systems in Australia and Malaysia
(Yong 2010)
Total Material Labour Plant
Australia (in AUD)
Cast-in-place Reinforced Concrete 309 154 (50%) 138 (45%) 17 (5%)
Precast planks, beams and columns 336 207 (62%) 85 (25%) 44 (13%)
Malaysia (in MYR)
Cast-in-place Reinforced Concrete 146 105 (72%) 32 (22%) 9 (6%)
Precast planks, beams and columns 384 336 (88%) 21 (6%) 26 (7%)

There is an analogous increase in total cost when a precast system in utilised in place of the
conventional reinforced concrete system in middle income Malaysia. This is to be expected as
the cost of precast elements are higher than cast-in-place elements due to additional connectors
and increased cost of transportation and handling. A comparable decrease in site labour is
observed. The remarkable difference is in the sizeable increase in material cost for precast
elements in Malaysia where the precast was shown to be three times the cost of cast-in-place
materials whereas the precast elements in Australia were only 34% more expensive. This
resulted in a total system cost for precast that was 163% higher than the conventional system,
negating any obvious advantages in speedier construction, increased productivity or improved
quality.

The cost ratios for concrete/skilled worker and reinforcement/skilled worker indicate clearly that
concrete and steel reinforcements are relatively cheap compared to the cost of labour in both the
US and Australia. It is apparent that with a concrete/skilled worker index of 12.6, and steel
reinforcement/skilled worker index of 176, it is more economical to adopt conventional cast-in-
place concrete practices instead of precast systems in Malaysia. This study has also shown that
analogous ratios of 3.1 and 20.8, respectively, will lead to a precast system cost that is only
marginally higher than cast-in-place systems, and the additional benefits of quicker construction,
better control over quality, and reduced exposure to weather risk can be achieved.

Mills (2009) analysed a range of construction designs that were applicable to commercial
buildings in Australia. Costs were worked out to include all work necessary to complete the item
fixed in place in its final position. The objective was to compare the cost relativities between five
Australian cities; Adelaide, Brisbane, Melbourne, Perth Sydney; but the data can be easily
averaged to provide a comparison of the different building systems instead. Six different systems
were computed by Mills although only four are discussed here as shown in Table 3 below. The
model was based on a ten-storey building with an 8.40m x 8.40m grid.

48
 Table 3: Comparison of per square metre cost for framing systems in Australia (Mills 2009)

Framing System Cost (sq.m)

RC frame with timber formwork AUD 499
RC frame with metal deck formwork AUD 477
Steel frame concrete slab with metal deck formwork AUD 769
Precast concrete frame AUD 348

The steel frame solution was significantly more expensive than all other options in this study.
Only about 10% of multi-storey buildings in Australia use this system due to the higher cost of
steel elements and the additional requirement for fire protection. The structural steel/concrete
index of 16 for Australia is significantly higher than the 6.7, 7.8 and 8.5 reported for Japan,
Russia and the US, respectively. The higher relative cost of structural steel may account for
fewer steel buildings in Australia compared to these countries. Additionally, builders in Australia
have a long culture of using concrete in multi-rise buildings, and have invested time and
technology to achieve a high level of cost performance. Precast appears to be the most cost
efficient design based on lower relative cost of concrete compared to skilled labour as discussed
in the earlier section.

With the cost of formwork/reinforcement at 0.10 in Australia it makes economic sense to utilise
metal decks to substitute for timber forms. Middle income countries with a formwork index of
0.1 to 0.2 would find it prohibitively expensive to adopt a similar product.

On a similar track, Proverbs et al (1999) examined the mean productivity rate in man-hours per
square metre for formwork for beams for UK, French and German builders. Their findings
indicate that the apparent differences were due to significantly more productive prefabricated
formwork systems used in France and the proprietary formwork system preferred by German
builders. The mean productivity rate for traditional timber formwork in the UK was 2.45 man-
hours per m2 whereas the best productivity rate for the Germans using proprietary forms was
1.25 man-hours per m2 followed by the French using prefabricated forms at 1.34 man-hours per
m2. Where German construction workers were the most very highly paid by in Europe, builders
were inclined to invest more into mechanizing production processes; thereby counteracting the
impact of such high wage rates. The economics of each nation are likely to have some influence
on preferred systems.

6 DISCUSSION

The above three case studies have shown how these indices can be utilised to justify the decision
to adopt more prefabrication in high income, high wage country like Australia while more labour
intensive construction processes are preferred in upper middle income, low wage Malaysia.
Many other examples of these options can be found if comparisons are made between systems
used in high income and middle income countries. Taking all basic construction materials

49
together in this comparison indicate that at locations where labour is relatively cheap, it will
certainly be worthwhile to adopt more labour intensive construction processes to reduce material
utilisation. The higher wage costs in a high income economy will evidently motivate builders to
reduce their dependence on labour by adopting labour saving options such as standardisation,
prefabrication or pre-casting even though these options may result in a greater quantity of
materials.

The indices can also inform on choice of materials to be used in the construction. At locations
where one material is cheap relative to another (eg. in Australia where one tonne of structural
steel is 16 times more costly than a cubic metre of concrete), one will observe a naturally higher
utilisation of one material relative to the other (more concrete relative to steel framed buildings).
This is also borne out by the anecdotal evidence of a greater number of structural steel buildings
in the US and Japan as compared to these countries where there is a stronger tradition of concrete
construction.

At locations where timber formwork is expensive due to the high wages, metal decking is more
widely used. In countries where formwork/reinforcement ratio was 0.05 or lower, timber,
prefabricated or proprietary formwork systems remain viable.

It is interesting to note that Vietnam, although belonging to the lower middle income category in
PPP terms has skilled worker wages in the upper middle income range leading to technology
choices that reduces the reliance on manual labour. With a cubic metre of concrete equivalent to
6 man-hours, it may be prudent to explore some form of prefabrication or standardisation of
concrete elements to reduce labour costs. Structural steel is also a feasible building system with a
cost index of 25 relative to concrete.

7 CONCLUSIONS AND FURTHER WORK

A preliminary set of cost indices have been derived from a data for construction material and
building elements in 16 countries ranging from high income, upper middle income and lower
middle income economies. The selection of preferred construction material, structural system,
and construction processes described in the three case studies can be rationalised by the use of
these indices. The small set of derived ratios based on skilled worker wages, and basic
construction materials such as concrete, steel reinforcements and structural steel is able to
adequately rationalise the choice between cast-in-place, metal decking systems, precast methods
of construction and structural steel framing systems.

While the focus of this paper is initially concerned with reinforced concrete methods of
construction, the derived ratios may be extend to inform on a wide range of construction choices,
either locally developed or imported from overseas, available to developing economies. An
indexed cost-technology model will provide the construction industry with a practical and
informative tool to evaluate the most appropriate options to deliver residential, commercial and

50
institutional buildings, especially for rapidly developing economies facing constraints of labour,
capital or resources.

Future work will focus on obtaining additional project cost data for the different structural
systems in various locations of interest to enable a further comparison to be made. This research
project is part of a broader study to exploit these indices to analyse a wider range of construction
technologies globally.

REFERENCES

1. Best, R., Meike, J. and Thomas, P. “A new approach to international construction price
comparisons”, Report to the World Bank – International Comparison Program, 2010.
2. Davis Langdon, “Spon's Asia-Pacific Construction Costs Handbook”, Fourth Edition, Taylor &
Francis Group, US, 2010.
3. Ganesan, S. “Employment, technology and construction development: with case studies in Asia and
China”, Ashgate Publishing Limited, England, 2010.
4. McCarthy, P., “Construction – Chapter 13, in Measuring the Size of the World Economy,
International Comparison Program”, The World Bank Group, 2011.
5. Mills, A. “Cost performance of multi-rise structures in Australia”, Building Economist, The, (Sept
2009), 10, 2009.
6. Moavenzadeh, F. “Construction industry in developing countries”, World Development, 6(1), 97-
116, 1978.
7. Proverbs, D. G., Holt, G. D., & Olomolaiye, P. O. “A method for estimating labour requirements and
costs for international construction projects at inception”, Building and environment, 34(1), 43-48,
1999.
8. Stapel, S., “The Eurostat Construction Price Surveys: History, Current Methodology and New Ways
for the Future”, International Conference on ICP, World Bank, Washington, 11-13 March 2002.
9. Sultan, B. and Kajewski, S., “Requirements for economic sustainability in the Yemen construction
industry, in Serpell, A. Ed., Proceedings International Symposium on Construction in Developing
Economies: New Issues and Challenges”, Santiago, Chile, 2006.
10. Turner and Townsend, International Construction Cost Survey 2012,
11. Walsh, K. and Sawhney, A., “Process for implementation of the basket of construction components
approach, International Comparison of Cost for the Construction Sector”, The World Bank Group,
2004
12. Warszawski, A. “Industrialized and Automated Building Systems”, E&FN Spon, London, 1999.
13. Yong, T.N. “Feasibility of precast concrete construction system in Malaysia: A comparative study
between Australia and Malaysia”, Research project report, The University of Melbourne, October
2010.
14. World Bank, GDP per capita (current US$), Available from
http://data.worldbank.org/indicator/NY.GDP.PCAP.CD , Accessed 15 August 2013.

51
 100 100,000 50 100,000
94.67

Concrete (cu.m)
90 Skilled worker average (hr) USD 90,000 45 90,000
Bricks (1,000)
World Bank 2011
Average Skilled Worker Wages (hour - USD)

80 80,000 40 Softwood timber (m) 80,000

Concrete/Brick/Timber Indexed to Labour

World Bank 2011
70 70,000 35 70,000

GDP per capital (PPP) 2011

65.67

GDP (PPP) per capita 2011

62.00
60 56.00 60,000 30 60,000
49.67
50 48.00 50,000 25 50,000
40.00
40 40,000 20 40,000

30 28.00 30,000 15 30,000

20 17.67 17.00 20,000 10 20,000

8.00 9.00 5 10,000

10 6.33 6.67 10,000
3.00
1.03
0 - 0 -

China
US

Aust.

UK

S.Korea

S.Africa
M'sia

India
S'pore

Ire.

Russia

Viet.
UAE

Can.

Ger.

Japan
China
US

Aust.

UK

S.Korea

S.Africa
M'sia

India

Viet.
S'pore

Ire.

Russia
UAE

Can.

Ger.

Japan

Figure 1 Hourly wage for skilled workers in US$ Figure 3 Concrete/Brick/Timber cost indexed to skilled worker

250 100,000 1000 100,000

Reinforcement (tonne)
Concrete (cu.m) USD 90,000 900 90,000

Reinforcement/Structural Steel Indexed to Labour

Structural steel (tonne)
200 191.00 World Bank 2011 80,000 800 80,000
World Bank 2011
167.00 170.00 70,000 700 70,000

GDP per capital (PPP) 2011

GDP (PPP) per capita 2011

Concrete (cu.m - USD)

153.00
148.00
150 60,000 600 60,000
135.00 133.00
121.00 50,000 500 50,000
117.00
109.00

100 40,000 400 40,000

83.00
75.00
68.00 66.00 30,000 300 30,000
60.00
55.00
50 20,000 200 20,000

10,000 100 10,000

0 - 0 -

China
US

Aust.

UK

S.Korea

S.Africa
M'sia

India
S'pore

Ire.

Russia

Viet.
UAE

Can.

Ger.

Japan
China
UK
US

Aust.

S.Korea

S.Africa
M'sia

India
S'pore

Ire.

Russia

Viet.
UAE

Can.

Ger.

Japan

Figure 2 Supply rate of 1 cubic metre of 30MPa concrete in US$ Figure 4 Reinforcing bars/Structural Steel costs indexed to labour

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 Table 1: Indexed ratios for 16 countries in local currencies

S'pore US UAE Aust. Ire. Can. Ger. UK Japan SKor Russia M'sia SAfr China India Viet.
Skilled worker average (hr) 22 65.67 29.33 60.00 29.00 55.00 35.67 30.00 2250 105k 500 18.33 46.67 20.67 48.00 184k
Indexed on Labour
Concrete (cu.m) 6.91 2.06 8.52 3.10 2.07 3.00 3.42 2.77 5.29 0.63 9.00 12.55 17.87 20.81 104.17 6.12
Reinforcement (tonne) 80.45 15.11 98.86 20.83 24.14 24.55 22.04 24.80 29.33 7.93 54.00 175.6 173.57 217.74 843.75 94.08
Structural steel (tonne) 236.4 17.51 187.5 49.25 35.17 38.18 82.68 59.53 35.56 10.92 70.00 241.1 428.57 416.13 1041.7 109.66
Indexed on Concrete
Reinforcement (tonne) 11.64 7.35 11.60 6.72 11.67 8.18 6.44 8.96 5.55 12.66 6.00 14.00 9.71 10.47 8.10 15.38
Structural steel (tonne) 34.21 8.52 22.00 15.89 17.00 12.73 24.17 21.52 6.72 17.44 7.78 19.22 23.98 20.00 10.00 17.92
Indexed on Labour
Concrete in slab (cu.m) 11.00 2.60 15.68 4.27 2.48 3.45 3.84 3.57 6.09 0.74 10.00 18.49 19.65 27.10 135.42 7.83
Reinforcement in beams (tonne) 80.45 31.98 136.36 40.70 31.03 34.55 51.93 33.67 43.11 11.54 92.00 195.16 190.93 314.52 1166.67 119.77
Formwork to soffit of slab (sq.m) 1.41 1.08 3.41 2.00 0.97 2.55 1.01 1.20 1.19 0.21 1.80 2.78 2.70 4.35 10.94 1.13
Structural steel beams (tonne) 236.36 43.48 340.91 104.97 65.52 59.09 87.08 70.67 51.09 18.52 170.00 361.75 525.00 474.19 1718.75 155.72
Indexed on Concrete
Concrete in slab (cu.m) 1.59 1.27 1.84 1.38 1.20 1.15 1.12 1.29 1.15 1.18 1.11 1.47 1.10 1.30 1.30 1.28
Reinforcement in beams (tonne) 11.64 15.56 16.00 13.13 15.00 11.52 15.18 12.17 8.15 18.43 10.22 15.56 10.68 15.12 11.20 19.58
Formwork to soffit of slab (sq.m) 0.20 0.53 0.40 0.65 0.47 0.85 0.30 0.43 0.23 0.34 0.20 0.22 0.15 0.21 0.11 0.18
Structural steel beams (tonne) 34.21 21.15 40.00 33.86 31.67 19.70 25.46 25.54 9.66 29.57 18.89 28.83 29.38 22.79 16.50 25.45
Indexed on Reinforcement
Concrete in slab (cu.m) 0.14 0.17 0.16 0.20 0.10 0.14 0.17 0.14 0.21 0.09 0.19 0.11 0.11 0.12 0.16 0.08
Reinforcement in beams (tonne) 1.00 2.12 1.38 1.95 1.29 1.41 2.36 1.36 1.47 1.46 1.70 1.11 1.10 1.44 1.38 1.27
Formwork to soffit of slab (sq.m) 0.02 0.07 0.03 0.10 0.04 0.10 0.05 0.05 0.04 0.03 0.03 0.02 0.02 0.02 0.01 0.01
Structural steel beams (tonne) 2.94 2.88 3.45 5.04 2.71 2.41 3.95 2.85 1.74 2.34 3.15 2.06 3.02 2.18 2.04 1.66

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