Causes of Cost Overruns Due to Outsourced Labour – Subcontractor’s Perspectives

EasyChair Preprint no. 9788

Abstract

Project cost overruns is a significant concern in construction. Statistics reveal that more than 80% of construction projects have not been completed on agreed time or budget due to several factors. Whilst the main parties of the project are blamed, where little evidence exist on sub-contractors cost overruns and causes of such overruns. This issue has attracted more significance within the UK construction context as majority of construction activities are increasingly encouraged to perform through various forms of subcontracting. However most of the Subcontractors are from SMEs hence are highly depended on outsourced labour. This study aims to identify the causes of subcontractor cost overruns due to inefficiencies of outsourced labour. Data was collected through a literature review and a case study of a subcontractor in drywall construction, who was fully depended on the outsourced labour. As part of the case study, six construction professionals who works for the selected subcontractor were interviewed. The results revealed that errors in tender documents, poor quality construction, low productivity, materials waste by outsourced labour as the most impactful causes for cost overruns. Evidently, subcontractor is averse to enforce strong performance measures on hired labour due fear of low retention of labour.

Keyphrases: Cost overruns, Drywall Construction, Outsourced Labour, Subcontractor, UK

@Booklet{EasyChair:9788,
  author = {Anupa Manewa and Marks Satins and Mohan Siriwardena},
  title = {Causes of Cost Overruns Due to Outsourced Labour – Subcontractor’s Perspectives},
  howpublished = {EasyChair Preprint no. 9788},

  year = {EasyChair, 2023}}