Unemployment data reinforces need for productivity and workforce reforms

New unemployment data from the Australian Bureau of Statistics (ABS) confirm a tighter jobs market, which will exacerbate cost and capacity pressures across the building and construction industry.

The ABS reports the unemployment rate fell to 4.3 per cent in October. Master Builders Australia Chief Economist Shane Garrett said the tightening of unemployment matters for housing and infrastructure delivery due to the existing deep and persistent workforce shortages.

“All jobs in the building and construction industry remain in shortage and we are staring down the barrel of an ambitious pipeline of work.

“Infrastructure Australia confirmed this week the civil and engineering construction sector will face a 300,000-worker shortage by 2027.

“BuildSkills Australia raised the alarm in their workforce capacity study, calling for an additional 116,000 workers to meet housing demand.

“A smaller pool of available labour, combined with stronger competition from other sectors, will push up project costs, delay completion timelines, and reduce the number of homes that can be built over the life of the Housing Accord,” Mr Garrett concluded.

Master Builders Australia CEO Denita Wawn said improving productivity across the industry is essential.

“Productivity gains can only happen with the right policy settings to expand workforce supply.

“We all know what the immediate fixes are: fix the apprenticeship incentive system so it reduces the cost and friction on employers to take on apprentices, modernise migration pathways with a dedicated construction visa so we remain competitive, and speed up the skills recognition system for overseas tradespeople.

“But it can’t stop there, long-lasting productivity improvements will require procurement reform, planning certainty and investment in innovation.

“Current settings are not fit for purpose. The apprentice incentive system remains fragmented, and while apprentices have better support, employer incentives will start to taper out from December.

“Migration settings are cumbersome and do not deliver the rapid, targeted trades capacity the industry needs.

“Master Builders calls on the Federal Government and state and territory ministers to act now, with a coordinated national response that adopts the industry-led measures as already identified by BuildSkills and Infrastructure Australia.

“These reforms must be implemented at a pace that labour supply and training capacity do not become the handbrake on housing and the demands of the broader built environment,” Ms Wawn concluded.

Media: Dee Zegarac, National Director, External Affairs and Engagement
0400 493 071 | dee.zegarac@masterbuilders.com.au