Construction Employment Boom Rolls On

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Monday, March 30th, 2015
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Demand for workers within the construction sector continues to intensify, with new figures suggesting that after adjusting for seasonal factors, employment within the sector has come off its peak but remains at historically elevated levels.

The Australian Bureau of Statistics has indicated that on a seasonally adjusted basis, the overall number of people employed throughout the sector edged down 0.13 per cent from a record of 1.0512 million people in the three months to November to 1.0498 million in the three months to February. Despite this drop, however, construction employment remained at its second highest level on record.

The possibility of this data including statistical anomaly or unusual adjustment cannot be ignored. The seasonally adjusted figures show the number of jobs being up by 45,800 compared with the same period 12 months earlier while the non-seasonally adjusted data suggests employment numbers have actually declined by 15,300 over the same period, an apparent statistical anomaly as like for like year-on-year comparisons should not be influenced by seasonal factors. The fact remains, however, that either number still infers strong demand for labour.

While stressing that getting a clear reading on the situation during a quarter which included Christmas was difficult, Housing Industry Association economist Geordan Murray welcomed the latest data.

“We are consistently getting readings of more than a million people being employed within the industry,” Murray said. “It’s very strong at the moment.”

Not surprisingly, the persistent strength of employment is creating issues with regard to the availability of skilled labour.

In terms of trades, Murray said the most recent HIA Trades report showed shortages emerging in residential areas such as bricklaying, ceramic tiling, plastering and roofing and in locations such as Perth regional WA, Brisbane and Sydney.

In addition, a recent Master Builders Survey suggested that the difficulty of sourcing a range of professionals and trades across site management, project management, bricklaying, concreting, carpentry, and wall and floor tiling as well as roof tiling was increasing. The latest quarterly report from quantity surveying outfit WT Partnership, meanwhile, talks of labour shortages and upward pressure on subcontractor pricing in terms of bricklaying and formwork trades in Western Australia as well as pressure throughout Western Australia and New South Wales in terms of ceiling and partition trades on large projects along with the return of  ‘selective tendering’ on the part of subcontractors in Queensland.

On the professional side, recruitment outfit Hays says strong activity in apartment building throughout Western Australia is driving demand for finishes forepersons, structures forepersons, project engineers, residential building supervisors, estimators, commercial contract administrators and project managers.

Employment conditions are particularly strong in New South Wales and Western Australia because of the current strength of home building activity in those markets.

All this will no doubt place upward pressure on wages and costs. WT, for instance, reckons that in 2015, tender prices for subcontract work will increase by around five per cent in New South Wales and 3.5 per cent in Queensland.

Going forward, Murray says the outlook for employment within the sector varies according to state, with New South Wales set to remain strong, Western Australia to remain strong for now notwithstanding the mining slowdown amid strong volumes of home building and Tasmania to improve amid a recovering home building sector and the start of work on the Royal Hobart Hospital.

construction employment

Construction workforce at a glance:

Of the 1.022 billion people employed throughout the sector in Australia (not seasonally adjusted):

  • 882,800 worked full time while 138,900 or 14 per cent worked part time
  • Around 65 per cent (660,300) worked in construction services, while a further 25 per cent (258,700) work in building construction and seven per cent in engineering construction
  • Around 905,000 were men and 117,000 were women, meaning men outnumber women in the workforce by around 7.7 to one
  • Around 38,900 are unemployed, giving an implied sector unemployment rate of 3.67 per cent.
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