Multivariate Analysis of Factors Influencing Construction Costs in Saudi Arabia

Cost overruns present a continuing challenge within the construction industry worldwide, carrying substantial financial consequences for project stakeholders, specifically in developing economies such as Saudi Arabia. This study employs a dual-method approach combining Principal Component Analysis (PCA) and Analysis of Variance (ANOVA) to comprehensively analyze the factors influencing construction cost during the construction phase in Saudi Arabia. Utilizing survey data collected from 1076 engineers working in the construction industry of Saudi Arabia, PCA identified three key components: (1) project management and technical deficiencies, (2) external and regulatory influences, and (3) financial and economic risks. Meanwhile, the ANOVA examined differences in the perception of those factors across several demographics and project-specific characteristics. Findings highlight critical areas where focused intervention could improve cost management practices. Combining these results, this study presents an integrated framework for construction industry stakeholders with helpful recommendations. This integrated analysis provides a robust framework for construction professionals and policymakers to prioritize cost management strategies, in accordance with Saudi Arabia’s Vision 2030 goals to encourage a resilient and efficient construction industry.

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