CONSTRUCTION AS AN ECONOMIC REGULATOR
The construction industry and its activities have an important role to play in socioeconomic development and quality of life. Construction activity accounts for more than 50% of the national outlays. Building Construction costs registered an increase in rates year after year at scales much faster than inflation. It is seen that in view of the increase in cost for basic input materials like steel, cement brick timber and other materials as well as the cost of construction labour, buildings cost increase at around 20% to 30% annually even when inflation is in single digit. Even though income levels of people are by and large brought in line with the levels of inflation through inflation indexed rise in salaries, year after year, housing is moving beyond the reach of the majority of the people. The reducing housing size for various categories in consecutive years in respect of the plinth areas, nature of specifications even with increased income levels would indicate the rapid increase in cost of construction. The urban population growth has increased to more than 30%, and has made the need for adequate housing for low income people a very important concern for the government. However, the rush to respond to these needs seems to result in a low quality housing that does not adequately match the needs of these people. In countries where construction contributed 3–5% to GDP, an implication for development policy was that unless the construction industry grew faster than the economy as a whole it might constrain national development (Han and Ofori, 2001). The construction industry is a main contributor to the national economy, therefore the more developed the industry is the more the contribution to the economy. Similarly, a developing economy leads to more construction projects and purchasing power means affordable projects. The interlink relation between the construction industry and the economy makes it clear that development...
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