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Event: Interview with Warwick Long, ABC Melbourne
Date: 4 April 2024, 3:50pm AEDT
Speakers: Denita Wawn, CEO Master Builders Australia
Topics: Cost of residential building, trades shortages
E&OE
Warwick Long, Host ABC Melbourne: Well, we are talking about a tradie shortage, but also the flow on effects in housing in Australia. We don’t have enough tradies, it’s more expensive than ever to build a house in Australia right now, with building materials workers and getting a tradie adding to those costs. The Builders collective of Australia saying, we’re building the most expensive houses in the world right now, and we’re building on average, the biggest houses in the world right now. So how do you work your way through this? How do you improve this system? Denita Wawn is the CEO of Master Builders of Australia and can join you on the program right now, Denita Wawn, welcome to the program.
Denita Wawn, CEO Master Builders Australia: Thank you and good afternoon everyone.
Warwick: It’s a pretty scary picture when I put it like that and when you look at what a number of groups are saying about what it takes to build a home right now.
Denita: Yeah, it is pretty scary at the moment, that people don’t want to invest in housing, whether it’s high rise right through to a detached house, because it’s too expensive. That expense is because of predominantly a shortage of qualified people. And, of course, we have added costs in terms of delays, in terms of planning and building approvals and the list goes on in many respects, because we’ve also got a shortage of experts throughout the entire building supply chain. So, we need to build an awful lot of houses, but at the moment, the conditions are just simply not enabling that to occur, and we’ve got to change that pretty dramatically.
Warwick: There have been a lot of inflationary conditions across the world, especially in the years after COVID. Why is it so expensive in Australia to build right now compared to other countries?
Denita: Well, at the moment, it is simply about people. In many instances, those inflationary impacts on materials has dissipated. In fact, I’ve just been at a meeting today saying that we’ve now got structural truss manufacturers saying that they’ve got yards full of trusses waiting for houses, but we’re not building them. Why? Because we’ve got a shortage of people. So, the people we do have that are expensive. And of course, it’s taking significantly longer to turn a home around. Pre-COVID, it was nine months, at the height of COVID it was 15 months, it’s still high at 13 months and time means money. So, we’ve got a compounding issue, whereby lack of people simply means that the cost has become prohibitive, which means we’re ultimately building expensive homes and not enough homes because people are not willing to fork out those types of costs to cover those expenses.
Warwick: So how I’ve been asking the audiences but how would you get more tradespeople in Australia? How would you solve this?
Denita: Well, I loved both of your callers, and women are one of the prime areas where we need to focus our attention. We’ve been running the Women Building Australia program for the last five years and we’re interestingly seeing many women who are entering in the industry, particularly trades, are women changing careers that’s close to having children. So, you’re looking at sort of 30- to 40-year-olds entering into the industry in the women cohort more so than the men. So, we need more apprentices through the education system, we need more people through the migration system, we need more women, but also, we as an industry need to ensure that we’re the best employers possible. That we’re providing the best conditions possible, and I’m conscious of the fact that we find that there are some disgruntled tradies out there that have left the industry. We’ve got to prove as an industry that we’re great employers, we have some fantastic employers in the industry, but equally many need to pull their socks up and focus on good HR practices and ensuring that we’re looking after all of the people that work in our workforce.
Warwick: Do you need the government and state and federal governments that is to stop building things, you have access to more workers? Or does that just only add to the problem?
Denita: It only adds to the problem, unfortunately, and we’ve got to see that building is not nebulous. Building, you know, a one-story home is very different to a high-rise home, very different to tunnelling, new roads and rail stations etc. So, we’ve got different skill sets that we’re all requiring. We know our industry has got huge opportunities in the longer term with a lot to build for Australians, whether it’s schools, hospitals, rails, roads, airports or homes. So, we need these people. And so, the focus therefore is have we got the right conditions to attract as many people as possible into a trade? I say no, we’re not encouraging enough kids and I know as a mother of teenagers, we’re simply not seeing enough encouragement of teenagers into looking at a trade. We’re not supporting people –
Warwick: Will that sort itself out though as trades people have become more rare their wages have gone up, so does that solve that problem? Will it make it more attractive to young people as a work participation if they if they see better dollars going to those jobs? Absolutely.
Denita: Absolutely. I recall my youngest when he was about eight saying, mummy, do I have to go to university to make lots of money? And I said, well, if you look at all your family around you, they’re all university qualified, except for your uncle who was a plumber and now a builder who’s got the most money. And he said, oh okay, I need to look at a trade. So certainly, I think we’ve got to recognize that there are huge opportunities, not only as an employee, but to be your own boss, you know, half of the – I think around about 300,000 [Correction, 162,000] businesses in our industry are self-employed, they are one man bands who have made the decision to be their own boss and have that entrepreneurial spirit, enabling them to ensure that their own well being is under their control.
Warwick: I don’t know how quickly you can answer this question, but just quickly to finish Denita Wawn, is migration, the solution or the answer? Can you get a lot more tradies by simply having more migrants come here with those skills? Or does that add to the problem because you need more homes with more migration?
Denita: Migration can add to the burden if it’s not done right. And our big focus there has to be as a country that we get the right migrants at the right time, in the right places, that are skilled to meet the skill shortages we’ve got. And that’s not just in building and construction, but we certainly know that it’s also relevant for the care community as well. So, we’ve got to have smart migration, rather than just blanket migration. And that’s a focus I’m sure that the government is grappling with at the moment,
Warwick: Denita Wawn, thanks very much for joining us.
Denita: Pleasure. Thank you.
Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au