Rising labour costs drive construction inflation – GSS report

New data from the Ghana Statistical Service (GSS) indicate that rising labour costs have become the dominant source of inflation in Ghana’s construction sector, outweighing price pressures from materials and equipment.
According to the December 2025 Prime Building Cost Index (PBCI) report, labour recorded a year-on-year inflation rate of 10.7%, significantly higher than the overall building cost inflation of 4.4% over the same period.
The figures suggest that contractors are increasingly facing pressure from wage-related expenses, even as some construction inputs show signs of price stability.
By comparison, the materials component recorded an inflation rate of 2.7%, while the plant category — which includes machinery and construction equipment — posted 5.6% year-on-year inflation.
The GSS explained that the PBCI tracks changes in the cost of constructing buildings by monitoring key inputs such as labour, materials and equipment, providing a reliable indicator of price movements within the sector.
In its bulletin, the Statistical Service noted that the index serves as a critical reference for investors, developers, contractors and policymakers, helping them to negotiate contracts, adjust project budgets and monitor cost trends in the industry.
Despite a marginal 0.2% month-on-month decline in the overall index for December, the GSS warned that persistently high labour costs could continue to affect project pricing, timelines and contract negotiations in the construction sector going into 2026.