As the resource sector boom fades, road and rail construction along with areas of commercial building such as retail, healthcare and accommodation facilities appear to be the best areas of opportunity for engineers throughout Australia.

On an aggregate basis, the overall dollar value of construction work done on building and engineering projects throughout Australia is expected to decline by almost 10 per cent from an estimated $212.015 billion in 2015/16 to bottom out at $191.444 billion by 2019/20 as work continues to fall back in sectors such as mining, water, and electricity, whilst that in the red-hot apartment sector comes off the boil.

That, however, masks a number of areas of opportunity. Despite sales having slowed in recent months, the pipeline of work in shopping centres and retail outlets is looking healthier. That was buoyed until recently by improved trading conditions, underpinned by the continuation of the Reserve Bank’s accommodative stance regarding monetary policy and the relatively low value of the Australian dollar.

The low dollar has also underpinned a surge in tourism numbers which, along with limited investment in accommodation facilities in recent years, has created significant levels of undersupply of quality facilities in tourism and accommodation, thus facilitating significant levels of activity in upgrading existing facilities and building new ones.

Thanks largely to a shortage of beds and an ongoing need associated with the aging population, meanwhile, healthcare is another area where good opportunities lie. And then of course, there is the massive boom in investment underway on road and rail projects.

Such shifts are reflected in the labour market. Whilst overall job vacancy numbers across engineering disciplines have fallen from about 9,000 at the height of the mining boom to around 2,500 today, the lift in the transport sector has seen vacancies for civil engineers begin to rise again over the past two years. In its most recent quarterly report, recruitment outfit Hays said that though parts of the overall market remained soft, demand was strong for a number of professionals including rail engineers, civil engineers and civil designers as well as senior design engineers and structural engineers for buildings.

All this comes amid what is considered by many to be a long overdue discussion on infrastructure within Australia. Shortly before the May budget, the federal government unveiled its plan to create 30 minute cities, which includes working with local and state governments to develop coordinated investment plans for cities and setting up a special unit to look at innovative financing solutions for major government projects.


That followed Infrastructure Australia’s release in March of a 76-point plan to deliver better infrastructure over the next 15 years. Amongst other things, that plan called for the government to establish a program of incentives for states which undertake infrastructure reform, consolidate a whole heap of funding pools into one fund, develop a national population policy, encourage the development of regional cities, and consider market based incentives such as road pricing to raise money to build and maintain new infrastructure as well as to encourage non-peak travel where possible.

Whilst state governments are beefing up investment, however, skepticism is also growing about the level of diligence being applied in some cases with regard to the extent of value being derived from some of these projects. In Victoria, for example, the state government does not have business cases for 31 out of 50 projects taking place under a $6 billion rail crossing removal program even though work has already started on two-thirds of the projects.

construction engineering

Areas of opportunity

According to forecasts from the Australian Construction Industry Forum:

  • Transport represents a significant area of opportunity as overall levels of public and private construction work done on roads increases from a forecast $14.377 billion in 2015/16 to more than $20 billion in 2019/20 and that on rail infrastructure grows from $6.7 billion to $9.1 billion over the same period. Growth will be fairly evenly spread across all states and territories.
  • Having already grown by around 18 per cent over the past five years, activity in retail and shopping centre construction represents another good area of opportunity, with the dollar value of construction work done expected to rise from an estimated $6.289 billion in 2015/16 to $6.656 billion in 2020/21 amid decent growth and a respectable pipeline of projects in New South Wales, Queensland and Western Australia.
  • Having expanded by more than two and a half times over the past 10 years, the dollar value of work done in healthcare construction is expected to remain at elevated levels and increase from $5.790 billion in 2015/16 to $6.525 billion in 2020/21 amid an overall shortage of beds and the need to cater for a growing number of older Australians.
  • Boosted by a competitive Australian dollar and a massive rebound in tourism numbers along with an undersupply of quality stock, activity on the construction of hotels and accommodation facilities has already shot up by around 70 per cent over the past two years and will rise by a further 37 per cent between 2015/16 and 2018/19 amid a significant pipeline of projects particularly in east coast markets.