Labor productivity is principal for economic efficiency and competitiveness, reflecting the ability of human resources to generate goods and services. Accurate measurement aids in comparing industries and regions, guiding businesses and policymakers. Previous research often lacks detailed data on the impacts of payment delays, overtime fatigue, and material shortages, hindering strategy development. This research addresses these gaps through analyzing factors affecting labor productivity in construction using AnyLogic simulation software. It aims to provide a comprehensive understanding of these factors' quantitative impacts and offer practical recommendations to enhance productivity, reduce costs, and shorten project completion times. AnyLogic models complex systems, facilitating process optimization and strategic planning. Key findings include that a 10-day payment delay reduces productivity by 2 units, a 20% skill level increase significantly enhances productivity, each hour of overtime reduces productivity by 5.08%, a 20% material shortage decreases productivity by 20%, and Boosting management efficiency by 10% improves productivity by 4.88%. The COVID-19 pandemic led to a 16.43% productivity reduction.