The boom in civil and engineering construction activity throughout Australia is rolling on, new data shows.

On a seasonally adjusted basis, data from the Australian Bureau of Statistics shows that the value of work done on civil and engineering construction throughout Australia rose by 1.9 percent during the September quarter to come in at $30.344 billion (2021/22 constant prices).

At this level, the value of work was up by 14.3 percent compared with the September quarter in 2022.

Activity is now at its highest level since the mining boom with the exception of a quarterly spike in work that occurred during the September quarter of 2017 on account of work on major LNG facilities.

Leading the way is transport, as the industry is currently working through a record pipeline of public road and rail projects.

Meanwhile, output in the electricity sector is powering ahead as the passing of Australia’s climate change legislation in 2022 led to a surge in commencements on renewable energy, storage and transmission projects.

Activity is also strong in work on water and sewerage facilities.

Encouragingly, the data also shows that the pace at which new work is coming in has trended higher.

Granted, quarterly commencement numbers have come off the pace since a spike in commencements that occurred in the September quarter of 2022 on account of the start of tunnelling on Victoria’s North East Link road project.

That quarterly spike, however, is a statistical anomaly. Comparisons against that quarter should thus be treated with caution.

Looking at the longer-term, quarterly commencement values have been tracking higher over the past 12-18 months (see chart).

All this has seen a surge in the forward work pipeline.

This is particularly the case in the electricity generation and distribution construction subsector.

At $14.923 billion as at September 30, the value of work yet to done in this sector has risen almost fivefold over the past seven years.

Not surprisingly, industry forecasters expect conditions to remain strong.

In its latest forecasts issued in November, the Australian Construction Industry Forum said that it expects the value of work done on civil and engineering construction to increase from already elevated levels of $107 billion in 2022/23 to $113 billion in 2023/24 and $115 billion in 2024/25.

Whilst the strength of activity is beneficial for some, the volume of work is leading to challenges in finding enough workers to deliver upon the nation’s infrastructure pipeline.

Already, construction industry employment stands at record levels. Vacancies for construction managers, engineers, tradespeople and construction labourers are all near decade highs.

Meanwhile, the Public Infrastructure Workforce Supply Dashboard maintained by Infrastructure Australia estimates that Australia currently has a shortage of around 240,000 workers to deliver upon the nation’s infrastructure program.


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