A combination of supply chain disruption, higher commodity prices and labour shortages has seen construction costs increase significantly in cities around the world, according to Arcadis’ report International Construction Costs 2022. The sustainable solutions consultancy firm advises that the construction industry needs to switch to increased use of technology and modern methods of building to manage the rising costs.
The report identifies London as the most expensive city in the world in which to build, closely followed by Geneva, but many cities in Europe and America recorded double-digit cost increases over the past 12 months. In Asia, costs were more stable, though labour shortages in Singapore drove higher levels of inflation, according to an article in the magazine Money Week.
Nevertheless, Simon Rawlinson, Head of Strategic Research at Arcadis, says there are reasons to be optimistic. “We believe these challenges more than ever present our industry with a great opportunity to drive forward innovation,” he says in the article. He promotes the idea of doing more with less, encouraging construction companies to make use of technological advances and modern methods of building to manage costs. He says that data analytics can reduce the long-term carbon footprints of buildings by designing and building them accordingly.
In addition, Arcadis advises that leading construction companies are now planning projects and agreeing timescales to reflect the availability of workers and materials. “Flexible, pragmatic decision-making can allow businesses to adapt to fluctuating and unpredictable conditions and put themselves in a market-leading position,” Rawlinson says.
