Identifying the Inherent Factors Causing Delays in the UAE Construction Industry

Abstract

The construction industry is one of the most important industries that impact the economy of a country as it contributes significantly to the GDP, employment, and wealth. The UAE construction industry contributes to 8.7% of the overall GDP which makes it a key industry for the country’s economy. The industry is challenged with several risks that plague the performance of the projects where most projects experience significant delays. Some of the consequences of the delays include loss of revenues for the owners, loss of future opportunities for the contractors, and litigation. The UAE has one of the most dynamic economies in the world, but it has also been suffering from delays in the execution of its construction projects. There is lack of recent research that identifies the most frequent, severe, and important causes and effects of delays in the UAE construction industry. This thesis aims to scrutinize the construction industry in the UAE and determine the most important causes of delays, the most frequent factors, the most severe factors, and the most important effects of delays. A total of 40 delay causes and 10 effects were identified through the literature review. A questionnaire was prepared and distributed to professionals in the UAE construction industry. A total of 128 responses were received and analyzed from owners, consultants, contractors, and the overall perspectives. Overall, the most important causes of delays were “Award the project to the lowest bidder”, “Delay in progress payment by the owner”, and “Change orders by the owner”. A high level of agreement was found between the consultants and contractors according to Spearman’s rank correlation results. The most frequent cause of delay was found to be “Award the project to the lowest bidder” while the most severe cause was found to be “Financial crisis”. The most likely effects were “Time overrun/extension of time” and “Poor quality of work due to hurrying the project”. Using Factor Analysis, 6 components are extracted explaining 83.87% of the total variance. Several recommendations are provided to mitigate the delays and to reduce the frequency and impact of the key causes.