In response to the latest National Accounts report released by the Australian Bureau of Statistics (ABS) — National Income, Expenditure and Product — the inextricable ties between construction activity and the broader health of the economy are once again on display but proposed draconian industrial relations laws risk upending the industry and eroding economic growth says Master Builders Australia CEO Denita Wawn.
The Australian economy grew by 0.4 per cent over the June quarter as construction increased by 2.2 per cent, being the strongest contributor to gross value added growth.
However, the building and construction industry has effectively been accomplishing more with less, as the total construction output remained unchanged during the June 2023 quarter and used fewer inputs than previous months.
The 2.2 per cent rise in construction activity was driven by a:
- 5 per cent rise in construction services driven by trades, and land development and sub-division services;
- 2 per cent rise in heavy and civil engineering construction due to increased infrastructure project activity; and
- 1 per cent rise in building construction driven by non-residential construction.
Dwelling investment fell by 0.2 per cent and house construction fell — with ongoing constraints on labour further extending average completion times confirming the importance of attracting more people to the industry and maintaining a flexible workforce.
“Economic growth is essential to our members’ business success and the ability to meet the residential, commercial and civil construction needs of the community. A stronger building and construction industry means a stronger Australia. Every $1 million worth of building activity supports around $3 million in activity across the economy. This multiplier effect is vital to keep our economy away from the risks of falling into a recession.
“The building and construction industry accounts for around 10 per cent of GDP and is made up of over 445,000 businesses, many of whom are small businesses who are doing it tough in the midst of a cost of living crisis and a profitless boom.
“We need to back small business and make it easier for them to succeed, we need to invest more in skills, cut red tape, tackle low productivity and high inflation, and critically, ensure that industrial relations laws support growth in our industry,” said Wawn.
