Unemployment up, but building workforce remains tight

15 October 2026

Today’s ABS Labour Force data for September revealed the unemployment rate rose to 4.7 per cent in seasonally adjusted terms.

Construction employment fell 0.4 per cent on the previous month and the building and construction labour pool remains tight, as workforce shortages continue to constrain housing supply, as well as non-residential and civil construction activity.

Master Builders Australia Acting CEO Melissa Byrne said that without action, the construction worker shortfall could reach 935,600 workers by 2035, placing up to $242 billion in housing and infrastructure construction activity at risk.

“We all know the frustration of not being able to get a builder. Tradies are working hard, but there simply isn’t enough of them to go around.

“The modelling shows Australia is currently facing a shortage of 141,000 skilled construction workers, and that figure will continue to grow if nothing is done.

“Alongside strengthening the domestic workforce pipeline, skilled migration reform is a key lever to address workforce shortages and increase building activity.

“Analysis shows that for every skilled migrant in residential construction; they have the capacity to contribute to 21 detached houses over a 30-year career.

“While these figures relate to residential construction, we also urge governments to prioritise skilled migration pathways across the entire construction industry, including civil and non-residential construction.”

Ms Byrne said commitments from both the Government and Opposition to prioritise construction within the skilled migration system were welcome, but must be backed by concrete reforms, including:

• a dedicated Construction Skills Pathway;
• an expansion to the Pacific Australia Labour Mobility (PALM) program to include non-licensed construction roles;
• the removal of, or a reduction to, the Skilling Australia Fund (SAF) levy;
• an international apprenticeship pathway;
• a streamlining of skills recognition;
• a National Skills Activation Program to bring the 18,400 under-utilised migrants already here into the workforce.

“This must also be matched by stronger incentives for Australians to take up a trade. The Workforce Blueprint sets out 32 recommendations to address the industry’s skills shortage, and these reforms should be adopted as a priority,” said Ms Byrne

Media contact: Dylan Hafey, Adviser, Media & Government Relations

0497 330 064 | dylan.hafey@masterbuilders.com.au