The Cibao entity warns of the effect on projects currently underway and whose units were sold before the measure was announced
SANTO DOMINGO. – The Santo Domingo East Builders Association (ACOSDE) and the Cibao Housing Developers and Builders Association (APROCOVICI) expressed their concern about the possible repercussions of the 20% wage increase for construction workers, warning that the measure could raise project costs and affect the final price of homes.
The adjustment, arranged by the Ministry of Labor on August 25, 2026, includes a staggered increase of 12% in the first stage and another 8% starting in June 2027.
Both organizations recognize that construction workers are fundamental to the development of the industry and the growth of national infrastructure, and they value initiatives aimed at improving their economic and social conditions. However, they consider it necessary to analyze the impact of wage increases on the sector's cost structure and on Dominican families' access to homeownership.
Concern over rising costs
ACOSDE argued that decisions related to sector remuneration should be based on a comprehensive technical analysis of construction costs, with the aim of reconciling improved working conditions with the stability of companies and the ability of families to acquire property.
According to the technical data cited by ACOSDE, labor represents approximately 30% of the total construction cost. In this context, the 20% wage adjustment, compared to the 8.05% recorded by the Consumer Price Index (CPI) during the period in question, would have a direct impact on construction budgets.
The entity estimates that this variation could translate into an increase of around 6% in the direct cost of housing, with possible consequences on the marketing price of the properties.
APROCOVICI also estimated that the accumulated salary increase could translate into an increase of up to 6% in the final price of homes, at a time when the sector faces other factors that put pressure on its costs.
The organization noted that, as of July 2026, year-on-year inflation stood at 5.47%, while the Direct Costs of Housing Construction index registered a year-on-year variation of 2.08%, according to data cited from the Central Bank of the Dominican Republic and the National Statistics Office.
For APROCOVICI, a salary increase of this magnitude represents a significant variation within the cost structure of projects, particularly because real estate projects are planned, financed and marketed months and even years in advance.
Impact on homes already sold
One of the main points of concern raised by APROCOVICI is the effect on projects that are currently underway and whose units were sold before the salary increase was announced.
The organization explained that a home sold at a given price cannot be automatically adjusted every time one of its cost components increases. Therefore, unforeseen variations during the financial structuring process can affect project margins, jeopardize their viability, and discourage new investments.
According to both entities, the impact could end up affecting new projects and, consequently, the price that families will have to pay for a home.
ACOSDE warned that a significant increase in building costs could reduce the purchasing power of households, especially those in the middle and lower income sectors.
A call for balance
The president of APROCOVICI, Mario Bonilla, stated that the challenge lies in finding a balance between improving workers' incomes and maintaining affordable housing for Dominican families.
“We want our workers to earn more and better. But we also need to preserve the capacity to produce housing at prices that families can afford,” Bonilla stated.
The union leader clarified that the organization's position should not be interpreted as opposition to improving workers' economic conditions, but rather as a call to consider the consequences that a significant change in the cost structure could have on the entire housing production chain.
The Association also noted that the wage increase comes at a time when the sector faces higher logistical costs associated with construction inputs and new risks to fuel prices stemming from international geopolitical tensions.
The combination of these factors, he warned, could put further pressure on production costs, investment, the pace of project implementation and, ultimately, on housing prices and supply.
ACOSDE and APROCOVICI call for dialogue
Given this scenario, ACOSDE reiterated its respect for the Ministry of Labor, the National Wage Committee, the authorities and the trade union organizations, and considered that social dialogue is the most appropriate way to reach solutions that benefit both workers and society as a whole.
The organization called for maintaining and strengthening dialogue spaces to evaluate alternatives that allow for improving workers' incomes without compromising job creation, the stability of construction companies, or the ability of Dominican families to access housing.
Along similar lines, APROCOVICI proposed evaluating the real impact of the wage increase on construction costs, employment, investment and housing prices, as well as strengthening the participation of specialized sector associations in discussions and decisions that may directly affect their cost structure and productive capacity.
The association also proposed establishing a permanent technical committee between authorities, workers and representatives of the sector to jointly analyze wages, productivity, formal employment and production costs.
He also proposed considering mechanisms for gradualism and predictability that would allow real estate projects to incorporate future cost variations from their planning stage.
Both ACOSDE and APROCOVICI reiterated their willingness to participate in dialogue spaces and contribute technical information and sectoral experience, with the purpose of reaching consensus that will improve the conditions of workers, preserve the sustainability of companies and prevent housing from becoming out of reach of the economic capacity of Dominican families.
A shared concern in the sector
The positions of both organizations add to the concern previously expressed by the Dominican Association of Housing Builders and Developers (ACOPROVI), which also warned about the possible effects of the salary adjustment on the value of homes.
ACOPROVI estimated that the impact could reach up to 6%, although in a staggered manner: 3.6% would be reflected initially and another 2.4% additionally towards June 2027.
The organization acknowledged the authorities' efforts to improve workers' income and quality of life, but maintained that decisions on remuneration must take into account their impact on the economic structure of the projects.
He also noted that labor represents about 30% of total construction costs and that the 20% increase far exceeds the CPI variation, calculated at 8.05% during the reference period.
The three organizations essentially agree that the challenge lies in securing better incomes for construction workers without creating pressures that ultimately drive up housing costs, reduce investment, affect project execution, or hinder Dominican families' access to homeownership.
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