More than half a million workers throughout Australia’s housing construction sector could be out of work as the impact of the coronavirus smashes Australia’s home building sector, the latest report says.
In its latest report, Housing Industry Association said it expects the overall number of residential construction starts to drop by more than half from more than 230,729 in 2017/18 to as low at 111,507 in 2020/21.
This, it warns, could put up to 500,000 jobs at risk after more than one million people worked on new homes and apartments in 2018/19.
In its report, HIA said the industry would be particularly hard hit by the crisis in international education, a weak domestic economy and the slowing of population growth.
Speaking of the loss of students and migration, HIA Managing Director Graham Wolfe said that in total, 625,000 international students were enrolled in Australian education – a number he said equates to demand for all of the past two years of apartment construction.
How many of these left in March and will not come back is unclear, he said.
“In 2018/19 the industry engaged over 1 million people to commence building almost 200,000 new homes,” Wolfe said.
“Next year we expect to start just 112,000 new homes leaving up to 500,000 jobs at risk.
“The shock to the economy from the halting of overseas migration, the absence of student arrivals and uncertainty over the domestic economy will see the market at a lower point in December 2020, than it was during the 1990’s recession. It will then continue to decline though 2021, even with the return of overseas students and migration.
“This shock will reverberate through the residential building industry, up and down the supply chain.”
According to Wolfe, the impact for small builders will be especially severe as many will feel the biggest impact from the crisis after September when their existing projects wind up and thus will not be eligible for the Commonwealth JobKeeper program.
He said restarting the economy and allowing students to return should be critical priorities for the government.