The latest Australian Construction Insights (ACI) Construction Monitor report shows Victoria remained at the top of ACI’s state rankings, while New South Wales has moved back up the table into second place.
“The Victorian economy is in rare form at the moment. The state has the fastest population growth in the country, the best-performing labour market, the strongest market for new home building and home renovations. ACI’s latest analysis now shows that the state also has the strongest performing non-residential construction industry in Australia. If Victoria played in State of Origin, they probably could have won that too,” said Economist, Geordan Murray.
South Australia has moved up the order into third, while Tasmania is in fourth position and rounds out the top half of the table. The mining trio – the Northern Territory, Western Australia and Queensland, occupy the next three places on the table while the Australian Capital Territory dropped to the unenviable eighth position.
“Taking a holistic view of the non-residential construction industry, the fall in work on mining and energy related projects is still the main story, which means a number of engineering construction sectors are weakening. Notably, heavy industry construction, bridges, railways, harbours, as well as infrastructure for electricity generation and transmission, and gas pipelines.”
“However, we’ve seen a marked jump in activity in telecommunications construction over recent quarters. If the NBN roll out gathers the momentum implied by their work schedule we should see more activity occurring in this sector throughout 2016 and 2017.”
“Investment in non-residential building continues to be held back by a lack of confidence. It is particularly evident in areas of commercial construction where there is a distinct lack of momentum. Nevertheless, the more buoyant economic conditions in the major eastern seaboard states should translate into a meaningful lift in private sector demand.”
“We are also on cusp of seeing a lift in public sector investment. The recent state budgets announced by New South Wales, Victoria and Queensland all have allocated funding for numerous major infrastructure projects which will deliver a boost for these states,” concluded Geordan Murray.
Image by Sean Heatley