NSW Leads Construction Jobs Surge

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Monday, March 24th, 2014
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A surge in hiring in New South Wales has seen building industry employment in Australia surge to record levels, the latest data has shown.

Detailed labour force data from the Australian Bureau of Statistics showed that total number of people employed within the construction industry throughout the country jumped by 28,200 in the three months to February to reach 1,037 million – the highest level on record and 2.3 percent above the 1.014 million people employed throughout the sector in the same period one year earlier.

Even when seasonal factors are taken into account, the number of jobs in the industry jumped by 19,700 to 1.026 million – the second highest level on record.

Employment in seasonally adjusted terms has now risen throughout the industry for four of the past six quarters, indicating general upward momentum since the industry experienced its trough in the middle of 2012.

Driving the gains was New South Wales, which put on 27,900 new workers amid a strong housing rebound, improving commercial conditions and still high levels of investment in transport and roads.

Employment in Victoria, meanwhile, recovered somewhat whilst decade-high levels of housing starts and a massive employment boom generated by the Ichthys project means employment is up by more than a third in the Northern Territory over the past two years.

Employment in Tasmania, however, dropped 11 percent to levels not seen since May 2006 whilst that in the Australian Capital Territory remains weak amid a pull-back in federal government investment.

Furthermore, the latest jobs surge has reignited fears of a looming shortage of tradespeople as building activity picks up as low levels of activity in recent years have fed through to low numbers of apprentices being trained.

nsw construction employment

Housing Industry Association Senior Economist Shane Garrett says whilst the supply and demand of trades is roughly in balance, areas of shortage are emerging in trades which have not benefited from the resources boom and had not seen new apprentices gain skills from work on large mining projects.

“If you take our trades report for example (the December quarter HIA Trades Report), the overall situation there is that there is a very slight undersupply but we are pretty much close to balance” Garrett said.

“But within that there is considerable variation. For example, in things like general building and electrical trades there is a very modest oversupply but that’s counterbalanced by shortages emerging in trades like bricklaying, tiling and roofing.”

Garrett says upward pressure on wages and trade prices will most likely intensify as building activity continues to recover, albeit with the extent of such pressures depending on how quickly workers returning from resource projects can be upskilled to work on housing and how quickly the nation can bolster the numbers of apprentices coming through.

Throughout 2013, for example, trade prices in the housing industry as a whole rose by 4.0 percent (HIA Trades Report, with sharper increases occurring in landscaping, bricklaying and carpentry.

In addition to the headline figures, meanwhile, the latest data also showed that of those working in the industry:

  • 889,000 worked full-time whilst 148,400 worked part time.
  • An estimated 50,200 are unemployed (not included in employment numbers above), giving the industry an unemployment rate of around 4.62 percent.
  • A further 54,300 were considered to be underemployed.
  • Almost 65 percent were employed in ‘construction services’ (666,800 people), 25 percent in building construction (261,200) and 8.4 percent (87,200) in heavy and civil engineering construction.
  • Around 911,500 men were employed in the industry compared with 125,900 women, meaning that men outnumber women in the industry by more than seven to one.
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