Labour costs in Saudi Arabia highest in the Gulf

In its "Third Quarter Construction Costs & Outlook Report", MEED reports that construction labour costs in Saudi Arabia are on average 18% higher than in the UAE, and 51% more expensive than Qatar.

The average daily skilled labour rate is 22% higher in Saudi Arabia in the United Arab Emirates. The report also found that even the daily unskilled labour rate is 14% higher in the kingdom than in the UAE.

Emil Rademeyer, General Manager of MEED Cost Indices (MCI) explained that "As a result of a smaller foreign labour contingent, the average daily rate for labour in Saudi Arabia is significantly higher than in the UAE."

The report starts off by investigating the current macroeconomic outlook for the six GCC countries and put forward a 5 year construction cost forecast for each country. The 5 year outlook is followed by an investigation into the cost of materials, labour, fuel and equipment in Saudi Arabia and the United Arab Emirates and put forward a cost comparison for these two markets.

Using advanced modelling techniques developed proprietary by MEED, the report presents a model evaluating the supply and demand dynamics of cement in Saudi Arabia. The results indicate that the demand for cement will peak in 2015. This peak in demand will be marginally within the supply capacity as at 2015. Thus logistical challenges in the supply chain are the likely culprit fuelling speculative shortages.

Similarly, the report investigates the trading environment for rebar in Qatar. Both these are contentious issues with raw materials frequently driving headlines as a result of perceived supply imbalances.

The report is part of the new MEED Cost Indices platform which allows users to query cost data for materials, labour, fuel and equipment for most of the GCC countries. Data is sourced directly from contractors, owners and consultants making the MCI data base the most accurate and comprehensive source of construction costs in the Middle East.

The new released platform provide access to GCC construction cost data, tender price indices and 5 year forecasts and also the latest global metal prices such as copper and steel.

Rademeyer added that "In addition to supply costs, MCI provide insightful analysis to the demand of resources across all the main industry sectors such as construction, industrial gas, oil, power, transport and water sectors across the GCC countries."

Richard Thompson, Editorial Director at MEED said "This is a breakthrough in bringing transparency to the Middle East construction market where companies can compare the cost of multiple resources across borders."