The boom in employment throughout Australia’s design and construction sector has subsided for now, new data shows.

And candidates and employers are being urged to adopt proactive strategies to achieve best possible outcomes in 2025/26.

On a seasonally adjusted basis, data from the Australian Bureau of Statistics shows that the number of people who are employed throughout Australia’s construction sector dropped by 61,500 to go from 1.379 million in February to 1.317 million in May.

This represents the second lowest quarterly reading in two years and the lowest quarterly reading siAll Postsnce February 2024.

However, construction employment remains well above pre-COVID levels (see chart).

Meanwhile, seasonally adjusted data from Jobs and Skills Australia indicates that job vacancies across occupations such as construction management, engineering, construction trades and construction labouring are at or near their lowest levels since the pandemic (see chart).

Austin Blackburne, Senior Regional Director – Construction at recruitment firm Hays, said that the slowdown in hiring reflects subdued conditions in housing construction along with a slowdown in infrastructure projects.

He said this has been most evident in Victoria and New South Wales.

“Large infrastructure projects in some cities are drawing to a close whilst others are picking up,” Blackburne said.

“The projects like the Metro Tunnel in the Melbourne CBD (finishing in 2025) were huge hirers and mass scale projects. Meanwhile, projects like the Torrens to Darlington (a 10.5km road project that will complete Adelaide’s North-South corridor) are just in their initial phases, showcasing that on the infrastructure side, there is a lag (between when existing projects are finishing and when new ones commence).

“There was an obvious slowdown in the domestic housing market which aligned with the COVID costs and rising interest rates. The data couldn’t be ignored with falling vacancies in both professional and trade roles indicating a softening across the entire project lifecycle – from planning and design to on-site delivery. There is a mixed outlook on commercial with public projects continuing but hesitancy around private developments. Civil/infrastructure remains the most stable by being supported by government investments.

“Geographically, in Victoria and NSW, there were clearer signs of a slowdown, particularly in residential construction, driven by cost pressures, urban saturation, and fewer new approvals. However, recently approvals have skyrocketed significantly led by NSW. Queensland and Western Australia are more resilient due to ongoing infrastructure and mining activity, and in Queensland we have recently seen job flow pick up significantly in line with the Olympics and accelerated apartment approvals.”

Despite the overall slowdown in hiring activity, Blackburn says that demand for workers continues to hold up in some sectors.

These include civil infrastructure, health and education projects, sustainability-driven roles, and refurbishment work.

He says that hotspots of demand are evident in roles that are harder to source. This includes engineers, project managers and skilled tradespeople in civil and services work. In particular, sectors such as industrial distribution centres and data centres are drawing in large quantities of electricians and building services professionals.

The latest data comes as Australia’s construction sector has experienced broadly challenging conditions over recent times.

In ne home building, activity levels have been subdued over the past two years as the sector has grappled with inflation, tighter monetary policy and higher construction costs.

Activity levels in this sector have been particularly soft in New South Wales and Victoria.

Turning to civil and engineering construction, the boom in activity appears to be reaching its peak at least for now as massive public infrastructure projects such as the West Gate Tunnel and the Metro Tunnel project in Melbourne and Cross River Rail in Brisbane are nearing completion.

This is coinciding with softer readings for new project commencements over recent quarters.

As a result, ABS data indicates that the dollar value of civil and heavy engineering work done contracted in March. This broke a continuous run of increases in quarterly activity which have been observed since COVID. (That said, activity remains at extraordinarily elevated levels.)

Nevertheless, worker shortages persist across several areas.

In the infrastructure sector, for example, the Public Infrastructure Workforce Supply Dashboard published by Infrastructure Australia indicates that the nation currently (as at July) is likely to have a shortage of 181,000 workers to complete public infrastructure projects.

Asked about the outlook for the new financial year, Blackburne expects employment levels to remain broadly stable with ‘pockets of growth’.

Opportunities are likely to be evident in infrastructure and sustainability-related areas as well as on industrial and data centre projects.

Finally, Blackburne encourages both employers and candidates to be projective in order to achieve best possible outcomes.

“Both candidates and employers will need to be proactive, adaptable, and strategic in 2025/26,” Blackburne said.

“Candidates in professional roles need to focus on gaining expertise in high-demand areas like sustainability, data and project management, as well as be flexible in working in regional and project-based roles. For trades/labour roles candidates, they need to keep certifications current, diversify skills (including new technologies) and maintain a strong work ethic for repeat opportunities.

“Employers in professional roles need to invest in training and career development, offer work options, build a strong employer brand around sustainability and innovation, and proactively manage talent pipelines. Whereas for trades/labour roles for employers, they need to provide competitive pay and incentives, support apprenticeships and upskilling, prioritize health and safety, and offer flexible schedules and locations to attract a wider labour pool.”

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