Will non-residential construction pave the way ahead?
Positive Reports by the Housing Industry Association and the Ai Group detailed the continued recovery of residential construction this year and they expect this will also continue into 2016.
The October publication by the HIA expects such an increased activity in 2016 due to accelerated recovery in the housing renovations market. This was principally due to older run down properties being in need of renovation and modernisation. Ai Group's Construction Outlook Report is conducted on a bi-annual basis and provides insight into the building and construction industry nationwide.
Total employment in non-residential construction is forecast to fall in 2015 in response to the decline in mining-related work. Good news for the New Year though, as the first half of 2016 is forecast to see a recovery in non-residential construction, due to the rising number of future infrastructure projects. This will hopefully lead to a much needed increase in labour hire demand.
The projected growth in the report for residential construction is due to the rise of apartment building approvals in recent months, particularly in Sydney, Melbourne and Brisbane.
Are skill shortages evident within the construction industry?
Overall, Ai Group's Construction Outlook Report asserted that increased costs in both labour hire and materials was a growing concern for respondents. Chiefly responsible for the increased labour costs were, wage growth and the difficulties faced trying to fill vacancies, which require specific skill sets. In addition, the rise in imported material costs and the low Australian Dollar contributed towards the increased costs of building materials.
Continued development of infrastructure increases the demand for skilled workers.
Looking to the future...In response to the nationwide infrastructure development, labour hire demand is expected to recover and rise in non-residential construction during the first six months of 2016.
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