A building industry lobby group has called for action to address the impact of the coronavirus on the construction industry, saying that planning and collaboration are needed to mitigate potential effects which the virus could have on the sector.
Australian Construction Industry Forum (ACIF) says efforts are needed to ensure that the threat to building projects is mitigated to the greatest possible extent.
In a statement, ACIF chief executive officer James Cameron said the virus may impact the sector in several ways.
Most immediately, there were concerns about the availability of building products and materials – around sixty percent of which he says are sourced from China.
Ongoing travel restrictions, could disrupt the flow of migration and skilled labour for work on projects.
Worse, should the Australian workforce become affected by the virus, workers here could choose to stay home.
“With more than 60 percent of the $6 billion worth of construction-related materials sourced from China, this represents a massive challenge for the industry if supplies continue to be affected,” Cameron said.
“Some builders and contractors are putting in requests for extensions of time for delays to their projects. This is contractually not always easy as many contracts do not provide illness as a reason for a claim.
“Where there are large components of structure, facades, and fit out in contracts, these usually require visits to suppliers’ factories in China.”
“Most major developers and builders are looking for alternative sources for Chinese building products, looking at alternatives to sending staff to China, and looking to find quality assurance specialists in China who can do inspections for them.”
“The construction labour force in Australia may also be affected due to the disruption to the migration of certain trades and professions needed for the industry.”
“If the coronavirus takes hold in Australia, construction projects may be further affected with sick staff and others staying home due to fear of infection. The construction industry labour force is highly integrated, and one missing link can mean that projects cannot continue.
“ACIF calls on industry and governments in Australia to collaborate to address all of these current and looming challenges. Let’s act proactively and be on the front foot to minimise the impact of this tragic outbreak of COVID-19 on the construction industry.”
Cameron’s call comes amid increasing concern about the likely impact of the virus among developer and builders.
Mark Bainey, chief executive officer of Capio Property Group, says his own projects were unaffected by delays but adds that for some larger developers, delays in building product supplies could push out completion times by up to six months (see article).
Master Builders Australia chief executive offer Denita Warn says the next four weeks are ‘make or break’ for the building sector.
According to a table released by Master Builders and published in The Australian, between 50 to 70 percent of our furniture (69.4 percent), glass (56.4 percent) and clay construction materials (50.5 percent) comes from China – as does 41.4 percent of our nails, screws and bolts along with 27.3 percent of our taps and values and 23.3 percent of our iron and steel.
Warne says these numbers understate the true impact of the virus.
“The statistics that weren’t shown on that table is the parts that we rely upon for Australian manufacturing building products,” Warne told Sky News.
“We know from the feedback from our members that not only are we having problems sourcing supplies directly from China, but also that manufacturing has ground to a halt in some instances across the country because the parts they rely upon are not being brought in from China.
“We are increasingly concerned. I’ve been surprised already about the extent of that concern build-up over the past week.
“We’ve been advised by those on the ground that the next four weeks will be make or break.
“Also good news today that we have heard that production is going to ramp up in China soon, although that is only third hand.
We are concerned for the next three to six months about what that does on construction sites.”