Analysis of Causes and Countermeasures for Rising Labor Costs in International Construction Projects

The labor costs in international construction projects conducted by Chinese building enterprises have presented rapid rising trend in recent years, which has adverse impacts on the project success and financial performance of building enterprises. This paper analyzes the causes for rising labor costs in terms of market supply/demand conditions and expected wage growth driven by inflation force. In order to reduce the labor costs and improve the working efficiency, we propose the countermeasures as (1) to determine the bid price and labor wage reasonably, (2) to adjust the ratio between Chinese and local workers, (3) to emphasize the importance of the training for local workers, (4) to strengthen the construction organization.