An industry structured for unsafety? An exploration of the cost-safety conundrum in construction project delivery

Abstract

An industry structured for unsafety? An exploration of the cost-safety conundrum in construction project deliveryConstruction accidents can have major social, financial, reputational and legal implications. Hence, it is to be expected that safety is often presented as a key priority for construction organisations. However, existing evidence suggests that within the construction industry, safety often loses the battle when a trade-off is required with project cost. Improved understanding of the manifestations of the cost and safety interaction are needed. A three-year longitudinal study afforded the opportunity to investigate the safety implications of sub-economic bids on a large infrastructure project in the UK. While lowbidding to win tenders is not new, this paper presents empirical evidence of the consequential safety risk implications of such bidding at the project delivery stage. Faced with a perverse form of the tender 'Winner's Curse' where the successful bid is frequently the lowest, cost-saving strategies are often implemented to recoup lost pricing margins. Our investigation revealed several instances of consequentially elevated safety risks, through cheaper and poor-quality equipment, machinery and temporary structures. In addition, lower-paid migrant workers -who already experience a statistically greater safety risk than local workers -were employed on the project without appropriate investment in a safety management approach suitable for a multinational workforce. The study both contributes to the call to critically rethink the construction industry's competitive bidding practices, and highlights an industry structure that creates the conditions for high safety risks and accidents.

Development of the Protocol of the Occupational Risk Assessment Method for Construction Works: Level of Preventive Action

“…The graph shows the different levels of preventive action control: L cap > 60% exhaustive control, L cap > 36% intensive control, L cap > 20% greater control, L cap > 12% more control, L cap > 4% adequate control and L cap < 4% optimal control. It can be verified that exhaustive levels of control are required for the construction systems that imply greater risk in accidents: foundations, structures, floors, façades, and roofs [ 39 , 50 , 51 ]. The risk perception values for the workers were between 10 and 15.…”

Developing a Dynamic Supervision Mechanism to Improve Construction Safety Investment Supervision Efficiency in China: Theoretical Simulation of Evolutionary Game Process

“…Han et al proposed that increases in tangible safety investment (e.g., incentive) generated stronger motivations for employees to enhance their behavioral safety performance [ 34 ]. Oswald et al suggested that the construction industry should invest more in safety and forward-thinking companies should exceed the minimum standards required by safety regulations and invest in voluntary accident prevention costs [ 14 ].…”

“…Safety investment usually has significant effects on the overall budget of a project [ 14 ]. Therefore, the optimal safety investment level ought to strike a balance between reducing the accident rate and controlling total costs [ 15 ].…”

“…Regarding this procurement approach, clients primarily select their preferred contractors based on a ‘lowest price policy’ in which the lowest bidder wins the contract [ 37 ]. Thus, to stay economically competitive and reach the maximum profits, many contractors have few motivations to invest adequately in construction safety [ 14 , 38 ]. A field survey conducted by Shohet et al on 30 construction projects revealed that the preventive safety activity resources actually invested by contractors are on average only half of the optimal amount [ 33 ].…”

“…Previous studies confirmed the positive effect of safety investment on safety performance [ 12 , 13 ] and showed that an increase in safety investment leads to better safety performance at construction sites. However, because safety investment is usually a part of the project contract sum in the construction industry and the specific structure of the industry is characterized by high competition, low profit margins and competitive tendering, construction contractors may unavoidably conduct a cost-safety trade-off in the bidding and construction stages, which leads to a common situation of insufficient safety investment in the construction process [ 14 ]. Under these circumstances, government supervision has been considered a key constraint for safety decision-making by contractors [ 15 ] and plays a significant role in promoting safety performance in the construction industry [ 11 , 15 , 16 , 17 ].…”