The Central government’s increased focus on infrastructure is one of the major reasons behind the rising labour cost in real estate industry, according to industry experts.
“In the last three years, the cost of labour had definitely increased in the range of 15-20%,” said Ashok Verma, CEO (International Business), Rudrabhishek Enterprises.
“This was due to the demand of labour force in infrastructure sector as well as the massive scale of construction in real estate itself,” Economic Times reported.
“Government expenditure on thousands of projects initiated under Smart Cities Mission across India has already created a large marketplace for private sector and is going to further translate into jobs at all level, better and efficient infrastructure and liveable cities for everyone,” said NSN Murty, Partner and Leader- Smart Cities, PwC India.
In 2012, wages of workers under Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in Maharashtra, Karnataka and Rajasthan was Rs 145, 155 and 133 per day respectively which now stand at Rs 201, 236 and 192 per day respectively, according to the government data. Similar kind of rise has been witnessed in other states and union territories as well.
The demand for skilled and semi-skilled labour has also increased in the construction sector in the past few years. There is also skill enhancement and training course for human resources in construction sector, which eventually has a cost attached to it.