What do Direct Costs refer to in construction?

Direct Costs in construction refer to expenses that can be traced directly to specific tasks, components, or aspects of the construction project. This includes costs for materials, labor, and equipment that are specifically required to complete a project or a particular phase of work. These costs are essential for estimating the overall budget and assessing the financial requirements of each aspect of construction.

Identifying and accurately estimating direct costs is crucial for project cost management, as it allows project managers to allocate resources effectively and monitor expenditures against budgeted amounts. Understanding direct costs helps ensure that any deviations are addressed promptly, aiding in maintaining financial control throughout the project lifecycle.