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Event: Interview with Stéphanie Kabanyana Kanyandekwe, ABC Radio Melbourne
Date: 3 July 2024, 2.25pm AEST
Speakers: Denita Wawn, CEO Master Builders Australia
Topics: Trades shortages; building approvals; apprenticeship incentives
E&OE
Stéphanie Kabanyana Kanyandekwe, ABC Radio Melbourne: It’s 25 minutes past two. If you’ve needed to call on a tradesperson recently, you might have noticed they’re a bit thin on the ground, and it doesn’t look like the situation will improve anytime soon. This year, there’s significantly less apprentices entering trade school. Joining us is Denita Wawn, she’s the Chief Executive of Master Builders Australia. Welcome Denita.
Denita Wawn, CEO Master Builders Australia: Good afternoon.
Stéphanie: So Denita, there’s a shortage of tradies, which trades are being hardest hit?
Denita: That answer is quite easy; all of them. Jobs and Skills Australia have identified that we’ve got shortages throughout all of the trades in building and construction industry. And of course, as we seek to build 1.2 million homes over the next five years, then we need trades. And it’s something that’s been a problem now for the last 10 years, but it’s certainly exacerbated at the current moment.
Stéphanie: Can you pinpoint what has caused this change, and so drastically within the last year? I believe the figure reported was something like 22% less of trainees going through trade school.
Denita: Part of it is because of the COVID incentives that were available have now stopped, although the government has put in some transitionary arrangements on incentives while they conduct a comprehensive review into apprentice incentives. And we certainly commend Skills Minister Brendan O’Connor of doing a deep dive into what works and what doesn’t. So, we’re hoping that this is a simple blip in the data as the government then implements the recommendations from that report, which we understand will be made public in coming months.
Stéphanie: We’re speaking with Denita Wawn who’s the Chief Executive of Master Builders Australia about tradie numbers on the decline. Denita, does this mean that existing tradies in the field are able to charge more?
Denita: Yes, they are and it’s part of the reason why we’ve got contributing increase to costs of building. At the moment it’s costing around about 40% more than pre-COVID figures to build a home or a unit. And that, of course, is having implications for whether or not people spend money on building. We know there’s opportunities there, but they’re simply not being realised because of cost escalation. And that concerns us, because we know that builders have got availability in their books, and they would like to continue to build, so they are seeking support of government, as well as industry leaders, to ensure that we’re getting an ongoing flow of tradies through the system.
Stéphanie: The figure reported, so a 22% decline in people going through trade school, does that mean that we’re still getting tradies coming through but perhaps not studying and just being straight on the job?
Denita: No, these are people who undertake an apprenticeship which is required to be a tradie. It is a requirement that we learn on the job as an apprentice and if you get a decline, then obviously we’re not getting the numbers through. And that’s on top of the fact that the national average of completion of a trade is about 50%, from those who commence. So, there has got to be a concerted effort from industry and government to look at not only how we attract people into commencing in the first place, but also how we support them throughout their training, so they are completing their trade and able to be qualified to work on the job.
Stéphanie: In your experience working with Master Builders Australia, what else does this new data show about lower apprentice numbers? What else are you hearing reported through to you?
Denita: Well, I think the other really big key issue is the industry is now acknowledging that it hasn’t helped itself in attracting only half the working population, and that is men. The industry only has 14% of its workforce are women, only 2% of the workforce of the trades are women. We have been missing in action in attracting women into our sector. And certainly, one of the big focuses that we’ve been undertaking over the last five years is our Women Building Australia program. We are seeing improvements in females commencing but certainly not enough, so that is also a big focus for the industry at large, to ensure that we’re attracting the best and the brightest, regardless of their gender.
Stéphanie: What types of initiatives can be put forward in order to get that diversity of trades people coming through?
Denita: Certainly in terms of support, we know that people are looking for support when they go onto a worksite. And so we’ve introduced things like mentoring programs, we’ve been very supportive of government looking at further incentives for the utilisation of group training organisations that do provide additional support in terms of mentoring and pastoral care. It does cost a little bit more, but it definitely creates greater opportunities for apprentices. We also are looking towards more work around attracting women and the industry itself needs to look at itself in terms of ensuring it’s got the best HR practices and the best workplace practices as well.
Stéphanie: We’re speaking with Denita Wawn, who’s the Chief Executive of Master Builders Australia. Denita, we’ve seen building approvals going down over the past few months, the most recent data on building approvals dropped today, what does it show?
Denita: Well, thankfully, we’ve got some good news on that front, we’ve seen an increase, not huge, but nevertheless a good positive result of a 5% increase overall, and a particularly good increase in a high density living. That is going to be critical for us in terms of ensuring that we meet the targets that governments have set for us. So, it was nice to see that news come through them an hour or so ago. Nevertheless, we’ve got to make sure that that continues, and workforce shortages are part of the issues that we’ve got to address to make sure that building approvals continue. But it was good news today to see a bump up.
Stéphanie: We’ve talked about tradie numbers dropping, what about prices?
Denita: Unfortunately, prices are not yet dropping in terms of the cost of building, and that then of course reflects in the prices of buying a home, whether it’s a new home or an existing home. So certainly, prices are difficult at the moment when we’ve got costs high. It’s not only because of worker shortages, but of course we’ve got inflationary impacts on materials, and so forth. So we really need to look at how we ensure the prices are leveled out in terms of the cost of building. And once we get an appropriate supply in place, you would hope that there would be a stabilisation in terms of pricing for houses generally. But the big focus at the moment is meeting the higher demand for rental properties, as well as social and affordable housing.
Stéphanie: We’ve got a comment in through our texts 0437 774 774. Peter in Burwood says I tried to become an electrician roughly 10 years ago, I did a pre-apprenticeship course, got 100% for maths, but I couldn’t get signed up. The feedback I got was because of my age, early 30s, I would have to get paid adult wages, and they would prefer younger people. There were a lot of other students in the same situation. And these days younger people don’t seem to be interested in trades and companies need workers. This is a comment from Peter in Burwood, your thoughts Denita?
Denita: Oh Peter, I feel your pain, I hear this story a lot, unfortunately and it’s one of the things that we have recommended to the government with their apprentice incentives. And that is that we need to look after those who are looking for a career change that find it difficult to get a job because you’d have to pay adult wages. It does cost business a lot to train an apprentice, it takes away senior people from work. So we certainly have put a recommendation in that there is additional financial support for those who are deemed adults, and therefore it’s too costly to employ them. So that’s something that we’re seeking to have readdressed.
Stéphanie: When will we see a drop in the cost of materials for building?
Denita: I think the simple answer, unfortunately, is when we see a decline in inflation. Inflation is being stubbornly high. We are seeing some materials go down, but equally we are seeing some go up, in part because of the increase in energy costs. And so that is really fueling the implications of building material prices. They are down a bit, but nowhere near to the level they were pre-COVID. And so that is of concern and inflation, unfortunately is playing a part in that as well as increasing energy costs as well.
Stéphanie: Appreciate your time today, Denita.
Denita: Pleasure. Thank you.
Stéphanie: It’s Denita Wawn, who’s the Chief Executive of Master Builders Australia.
Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au