THE COST OF CONSTRUCTION ACCIDENTS IN SAUDI ARABIA
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TABLE OF CONTENTS.
Abstract. ........................................................................................................................................................ 3
Introduction. .................................................................................................................................................. 4
Literature Review. ........................................................................................................................................ 7
The Cost of Construction Accidents. ........................................................................................................ 8
Direct Costs. .......................................................................................................................................... 9
Indirect Costs. ....................................................................................................................................... 9
Problem Statement. ....................................................................................................................................... 9
Hypotheses. ................................................................................................................................................... 9
Aims. ........................................................................................................................................................... 10
Objectives. .................................................................................................................................................. 10
Methodology. .............................................................................................................................................. 11
Limitations. ................................................................................................................................................. 11
Project Assumptions. .................................................................................................................................. 11
Ethical considerations. ................................................................................................................................ 12
Conclusion. ................................................................................................................................................. 12
References ................................................................................................................................................... 13
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Abstract.
This proposed study aims to establish the actual accumulated costs related to construction
accidents in Saudi Arabia. Due to the boom of the construction industry, accidents in the
construction sites are a growing concern, primarily because of the associated costs. The high
rates of accidents have significant cost implications that affect project performance. The
proposed study builds on the premise that these accidents can be prevented or reduced if the
safety guidelines are followed. Consequently, the construction industry will potentially
experience better outcomes and positive safety performance. The study hypothesizes that the
actual costs of accidents are often miscalculated.
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Introduction.
Occupational health and safety (OHS) are some of the most vital aspects of any
organization or industry. The construction industry is undoubtedly one of the riskiest
occupational environments. In the Kingdom of Saudi Arabia (KSA), poor OHS performance is a
critical concern that affects both the private and public organizations (Azmat & Saad, 2018). The
industry is labour intensive and involves the movement of heavy materials and machinery within
dangerous areas, and this results in increased chances of safety hazards.
Similarly, in KSA, the construction industry is the leading cause of occupational injuries
and illnesses (Mosly, 2015). The construction industry is vast and continues to expand, and this
also implies that the number of injuries and illnesses will continue to rise if no measures are
taken. According to data from the Government Organization of Social Insurance (GOSI), an
estimated 122,645 people got injured in the construction places between 2015 and 2016 (GOSI,
2018). By comparison, the rate of occupational accidents in the construction industry was twice
that of other industries in KSA (Azmat & Saad, 2018). According to GOSI (2018), the
construction sector reported a record of 26,982 cases of injuries in a single year in 2015. In the
recent past, the construction industry reported a similar trend, whereby the most significant share
of injuries and illnesses resulting from workplace accidents pertained to the construction
industry.
The high rates of construction accidents are mainly attributed to the lack of awareness
about OHS among construction workers, and the lack of experience (Abukhashabah et al., 2020).
Furthermore, poor OHS measures in the kingdom exacerbate the number of accidents in the
industry. The situation is the same across many countries, with nations recording the highest
number of accidents from the construction industry than any other industry.
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The industry accounts for 11-13% of the global GDP, and this was projected to rise by
15% in 2020 (Schilling, 2015). The construction industry in KSA offers employment
opportunities to a significant percentage of the population, thereby contributing to the overall
economic development. The General Authority for Statistics reported that 1.07 million people
had secured employment in the construction sector in 2017 ("Saudi construction sector," 2019).
Despite the industry's contribution to the livelihoods of the population and the economy,
it is continually faced with the challenge of occupational accidents. The cost of workplace
accidents has a tremendous economic magnitude on the employers, their employees, and the
whole economy. It is estimated that the construction sector pays USD 461 million for injuries
and sicknesses suffered by construction workers due to occupational accidents (Azmat & Saad,
2018). The vast amount spent on accidental expenses is a plague in the construction industry.
Furthermore, the accidents cause delays in the construction projects, hence the significance of
the implementation of OHS measures.
The boom in the construction industry and recent tragic accidents have made the
employees’ health and safety paramount. KSA passed health and safety legislation and policies
that uphold the safety of workers in all sectors. For example, the Kingdom's Ministry of Labour
commenced site visits to inspect violations of any OHS laws. A total of 35, 250 labour laws were
reportedly violated ("Workers' Health and Safety Regulations in the Kingdom of Saudi Arabia,"
2015). The Ministry of Labour in KSA is charged with regulating the construction industry and
determining who can work on any construction project. Additionally, GOSI has a provision for
occupational injury benefits for workers. Also, the Saudi Labour Law provides health and safety
protocols that employers must adhere to. In the construction industry, the law stipulates that
employers must provide a healthy working environment for the workers devoid of any
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occupational accidents and illnesses (Law, 2005). They must also limit the danger of tools and
machinery so that they maintain the highest health and safety standards that protect workers from
any injuries, and machinery from any damage. Additionally, the law provides more obligations
that touch on employers, workers, supervisors, and minors.
The higher rates of occupational accidents are associated with corresponding cost
implications. However, many people are never mindful of the hidden or indirect cost of
construction accidents. Balgheeth (2016) reports that due to the lack of government measures to
ensure safety, accidents that could be avoided by standard safety procedures continue to affect
the industry adversely. Whereas it is impossible to insure against all costs of construction
accidents, measures can be formulated to prevent accidents. Consequently, the construction
industry can benefit from the potential benefits of accident prevention, such as reduced time and
money wastage, and employees from better health and reduced harm in the workplace.
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Literature Review.
The KSA construction industry is rapidly growing, and this is evidenced by the mega
construction projects across various regions. The industry's growth has led to a corresponding
growth in the body of literature investigating the country's OHS performance. Numerous studies
all aim at investigating the actual cost of construction accidents in KSA. Awad agrees that
although KSA is experiencing a rapid growth in the industry, it performs poorly in the aspect of
occupational safety (Awad, 2013). A study by Smith (2013) further suggests that the
construction industry in KSA focusses on assessing techniques for managing the accidental
expenses instead of directly implementing measures that will safeguard the workers from such
accidents.
Evidence points out that the low level of awareness about workplace safety is a leading
cause of accidents in Saudi’s construction industry (Abukhashabah et al., 2020). As such, it is
imperative to improve the level of consciousness concerning the significance of OHS in the
construction sites (Hemamalinie et al., 2014). Shamsuddin et al. (2015) highlighted that
construction industries waste a significant amount of time due to injuries and sicknesses related
to site accidents. Albogamy et al. (2013) expressed similar views, stating that the delays in the
completion of construction projects due to site accidents were a matter of deep concern and that
safety issues require proper assessment techniques. Erogul and Alyami (2017) observed that
despite the efforts by GOSI to uphold workers' OHS in the construction sites through various
regulations, the employers show laxity in complying with the health and safety measures and
protection of the rights of their workers.
Many researchers also conclude that lack of experience is a significant challenge facing
health and safety at a personal level. A significant proportion of the workforce involved in
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construction activities comes from foreign countries, especially Asian countries like Pakistan,
Bangladesh, India, the Philippines, and Nepal (Azmat & Saad, 2018). The workers are
inexperienced and lack awareness of common health and safety procedures (Balgheeth, 2016).
The immigrant workers have basic or no education and only seek employment in the
construction industries to remedy their socio-economic deprivation (Erogul & Alyami, 2017).
Consequently, they are affected disproportionately with workplace accidents than the local
workers (Salminen, 2011), and are often assigned the riskiest jobs in the sites (Balgheeth, 2016).
The studies reveal the reasons behind the high level of ignorance towards OHS and the
inexperience within the workforce.
The Cost of Construction Accidents.
Currently, there is no study in the context of KSA that attempts to quantify the actual
costs of construction accidents comprehensively. The existing studies on the true cost of such
accidents typically compare the direct and indirect costs or the value of money used on
compensation claims for injured workers. Noteworthy, the costs of accident-related health issues
differ and are determined by many factors, such as the level of severity of the impact caused by
accident (Levitt & Samelson, 1993). As such, the severity ranges from minor accidents to severe
fatalities. More severe accidents are likely to make the workers take more time before resuming
their duties, and so are the associated costs that get higher.
The costs of construction accidents can be categorized as either direct or indirect costs
(Pillay, 2014). The total direct or indirect costs of accidents incurred by an organization in any
construction project heavily relies on the health and safety performance (Tang, 2004). Moreover,
any accident could lead to several direct or indirect costs.
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Direct Costs.
Direct costs associated with accidents are related to the treatment of injuries arising from
accidents, and any compensations paid as a result of the injury (Levitt and Samelson, 1993). In
other words, they are the expenses related to injuries that are easy to identify. Hinze (2006) also
added that workers' compensation insurance often covers direct costs. Wages paid on injured
personnel are an example of direct cost.
Indirect Costs.
These are the costs of the accidents that are less evident, are also referred to as hidden
costs (Pillay, 2014). They are not well-defined costs, and their elusiveness explains why they are
the most evasive costs in the construction industry. Notably, the value of indirect costs typically
exceeds that of direct costs because they are challenging to access since the information is
usually not well captured. Levitt and Samelson (1993) opined that indirect costs include; costs
incurred while transporting injured workers, costs arising from delays, costs on supervision,
costs of replacing damaged or destroyed equipment, or materials.
Problem Statement.
The high rate of accidents and injuries in KSA’s construction industry needs to be well
documented. Despite the significance of construction safety, there is an existing research gap to
determine the actual costs of accidents related to construction in KSA. Consequently, the lack of
adequate research on the nature and the real cost implications of construction accidents have led
to the ineffectiveness of measures against health and safety hazards.
Hypotheses.
The proposed research will test the following three hypotheses.
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1. Construction accidents make organizations incur direct and indirect costs.
2. Organisations never quantify the actual costs associated with workplace accidents.
3. Little effort is made to determine the real costs of accidents and its economic
effects.
Aims.
The proposed research aims to analyse the statistics related to construction accidents from a
construction company in KSA. The study will focus on an organization that spends heavily on
construction works to determine the extent of accident costs and the far-reaching implications of
these costs on the organizations.
The proposed study aims to fill the existing research gap by analysing records of accident-related
costs and determining the extent of both direct and indirect accident costs incurred by the
organization.
Objectives.
1. To analyse reports related to construction accidents to establish the actual total costs of
construction accidents, as far as practically possible.
2. To determine and distinguish the accident costs.
3. To ascertain the individual costs that can be classified as indirect or direct costs and;
4. To improve awareness of the adverse effects of occupational accidents on the overall
performance of a project.
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Methodology.
The study's methodology will involve an exploratory review of several selected
constructions related accidents and injuries. After that, the study will investigate the
consequences attached to the accidents and the different types of construction accidents.
Additionally, to achieve the study's objectives, a comprehensive review of accident databases in
KSA will be carried out. Keywords will be used to search the pertinent databases, and only the
articles that meet the inclusion criteria and the definition of an accident will be comprehensively
reviewed.
As such, the research methodology will involve the following key steps;
• Literature review; a review of the theories and models related to accident costing.
• Access to accident-related investigation records.
• An extensive analysis of the collected data.
• Ascertaining if the findings are consistent with the literature.
• Formulating sustainable and effective accident prevention interventions.
Limitations.
The potential limitations of the study are related to the availability and access to data.
Project Assumptions.
The study will assume the accuracy of the data collected for analysis. The data providers will be
required to provide relevant and accurate data for the study.
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Ethical considerations.
The study will be conducted under ethical standards. Ethical considerations, such as
confidentiality and privacy, will be upheld. In conducting the study, there will be no mention of
individual names, and everything will be done with informed consent to the individuals.
Conclusion.
The increasing rates of occupational accidents in Saudi’s construction sector necessitate
the analysis of the associated costs. By conducting comprehensive research on the actual cost of
accidents, organisations will understand the implications of the high number of accidents, which
is often overlooked. Literature suggests that the indirect costs related to construction accidents
exceed the direct costs. The overall costs of these accidents are higher because they are not
accurately captured and recorded. Therefore, a study on the cost of construction accidents in
KSA will improve the prospects of enhanced OHS interventions, reducing the rate of accidents
and associated costs. However, achieving this objective requires that the information on the
actual accident-related costs be collected and recorded. The paper has outlined the body of
literature relating to the cost of accidents in KSA, the study’s problem statement, hypothesis to
be tested, the research methodology, aims and objectives, the possible limitations, assumptions,
and the ethical considerations.
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References.
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construction industry in Jeddah city. Saudi Journal of Biological Sciences, 27(8), 1993-
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Albogamy, A., Scott, D., & Dawood, N. (2013). Dilemma of Saudi Arabian construction
industry. Consultant, 63, 31.
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Eastern Mediterranean University (EMU)-Doğu Akdeniz Üniversitesi (DAÜ).
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THE COST OF CONSTRUCTION ACCIDENTS IN SAUDI ARABIA
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some%20are%20sector%20specific.
