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The downturn in civil construction throughout Australia is deepening as the benefit of a road building boom has failed thus far to offset the massive pull-back in resource related investment.

Releasing its latest data, the Australian Bureau of Statistics says the overall value of engineering construction work done (seasonally adjusted) fell by 2.1 percent in the December quarter to come in at $19.696 billion – down 18.1 percent from its level a year earlier.

engineering construction

This came as an 8.6 percent jump in work for done for the public sector (year-on-year) was nowhere near sufficient to offset the 28.6 percent decline in that done for the private sector.

Not surprisingly, resource related sectors led the charge downward, with the dollar value of oil, gas, coal and other mineral facilities plummeting 38.4 percent year-on-year to go to from $12.168 billion to $7.436 billion.

Work also plummeted 68.6 percent in pipelines and fell in gas and electricity, harbours and railways.

Equally unsurprisingly, the bright spots were roads and bridges, where work was up 27.2 percent and 23 percent respectively.

engineering construction

In terms of states, Western Australia led the fall with a 48.9 percent drop in work (year-on-year) followed by South Australia (down 17.7 percent), the Northern Territory (-8.4 percent), Queensland (-4.5 percent) and Tasmania (-3.0 percent).

On the bright side, work rose by 40.6 percent in the Australian Capital Territory and by 10.6 percent and 9.8 percent in Victoria and New South Wales respectively.

Whilst the civil sector is set to benefit from several years of transport construction boom going forward, the latest data shows that this is nowhere near sufficient to offset the resource sector decline as of yet.

Still, some green shoots are starting to appear.

At $68.7 billion, the overall pipeline of work yet to be done is at its lowest level in more than seven years as the forward order book in resources and mining as well as pipelines sits at seven year lows whilst that in electricity assets is at its lowest level in more than ten years.

Nevertheless, the pipeline of work on roads sits at record levels whilst that on bridges and railways is also healthy

engineering construction

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