As we launch in to the new year, the strength of building approvals confirms the strongly positive outlook forecast in 2015.
Construction industry forecasts show growth of more than 12 per cent in the value of work done in the residential sector. The value of work done is predicted to be nearly $60 billion in 2014/15.
In some markets such as NSW, residential growth is expected to reach unprecedented highs in 2015 with over a 17 per cent rise which is equal to a nearly $16.5 billion boost in the value of work done. Tasmania is another state where a rise of over 20 per cent (equal to around $683 million) is forecast.
Confidence in commercial building is also predicted to improve with Master Builders forecasting moderate growth over the next three years. In addition to this demand, the Department of Employment projects that demand for jobs in the industry will grow by 83,500 to November 2018.
The latest data released by the National Centre for Vocational Education Research (NCVER) highlights the apprenticeship system is not meeting the needs of industry.
The industry is not currently training enough apprentices to meet either current or future demand.
Unless there is a dramatic increase in the number of people in skills training, then the building and construction industry is heading for a skills crisis putting billions of dollars of investment at risk.
The latest NCVER statistics show that commencements have declined from 22,100 in 2010 to 17,200 in 2013 before an increase to 18,000 in 2014.
While the nearly five per cent increase in the numbers of young people starting an apprenticeship in 2014 is good news, it comes off an extremely low base and is way below industry requirements and belies the dramatic drop off in commencements of 18.5 per cent since 2010.
A similar picture is painted with apprentice completions ranging from 11,100 to 14,500 each year since 2010. While there has been a welcome 30.6 per cent increase in completions in 2014 it comes off a low base and is totally inadequate to meet the industry’s needs.
While we welcome the Government’s moves to remove red tape from the skilled migration system, Master Builders’ first priority is to train and employ Australians. A more flexible skilled migration system will not cost young Australians jobs as unions claim.
The skilled migration program is not about bringing in foreign labour at the expense of local workers. It is about allowing the building industry to better respond to current and forecast future demand where no appropriately skilled local labour is available.
Therefore, industry and Government need to work together to develop reform to ensure that the apprenticeship system better meets the needs of industry and young people.
The first stop in this process must be new thinking that enables the industry and education providers to enhance pathways from school to apprenticeships and into rewarding careers in the industry. This must be complemented by a more flexible industrial relations system.