Construction Employment Hits All Time High

Tuesday, September 24th, 2013
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The building phase of the resources boom may be nearing an end, but for now, strong activity in that sector has propelled overall employment levels in the construction industry to record highs.

On a seasonally adjusted basis, the latest report from the Australian Bureau of Statistics indicates that the overall number of people employed in the industry throughout the country jumped by 55,800 from 1.007 million in the three months to May to 1.063 million in the three months to August.

That is the highest level on record, 79,700 above the same number recorded in the corresponding period in 2012.

Furthermore, compared to the same period 12 months earlier, employment numbers are up in every state except Tasmania, with Victoria leading the way by adding 33,600 workers over the past year.

Housing Industry Association chief economist Harley Dale says the data reflects the strength of work associated with the mining boom, where construction activity is still at extremely high levels and local firms are raking in contracts from the massive volume of projects which received the go-ahead over recent years. This boom still exists despite the fact that few new projects in this sector have been announced of late.

Asked whether or not the figures could be confidently relied upon in light of low levels of activity seen in recent times in areas of the industry outside of mining, Dale says the data is not altogether surprising in light of the strength in resource activity and adds that outside of Western Australia, employment in states such as Victoria and New South Wales remain below their post-GFC stimulus peak.

He notes, however, that employment is a lagging indicator (strong civil sector work now reflects projects for which investment decisions were made over the past couple of years) and that the latest update does not take away from the discrepancy between the strength of resource work and weakness in the building sector.

Construction Employment

“There is still quite a large discrepancy between the tail end of the resources related investment and the non-resources related investment which continued to go backwards,” he said.

Indeed, the latest report comes as soft labour market conditions persist across much of the industry. In the residential sector, for instance, the most recent HIA Trades Report indicates that 10 out of 13 trades are currently in oversupply. Meanwhile, participants in the most recent National Survey of Building and Construction conducted by Master Builders Australia indicated that across almost all categories, skilled personnel for on-site work is becoming easier to find.

The data comes amid longer term concerns about a looming shortage of skilled workers and upward pressure on labour costs toward the middle of the decade as low numbers of apprenticeships on offer during the downturn are expected to lead to a tightening of supply as the building recovery gathers further momentum.

Though staunchly opposing recent wage hikes for apprentices, building industry groups have long been lobbying for measures which would support the apprenticeship system and increase the number of trainees coming through.

Toward this end, the new Coalition government has pledged financial support of up to $20,000 in the form of loans to apprentices in order to help them manage financial commitments throughout the course of their apprenticeship.

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