Labour market shift shows tax hikes coming at the wrong time

21 May 2026

Today’s ABS data shows Australia’s unemployment rate jumped to 4.5 per cent during April. This is the highest it’s been since late 2021.

“Interest rates have been jacked up three times since the start of the year, on top of the fuel price and supply chain shocks. The pain is starting to show in today’s data with our economy shedding 18,600 jobs during April and unemployment closing in on a 5-year high,” said Master Builders Australia Chief Economist Shane Garrett.

“Although the labour market softened during April, the building and construction industry continues to be constrained by workforce shortages. The rise in unemployment has not improved conditions, and a simultaneous decline in investment confidence risks making the situation worse.”

Master Builders Australia Acting CEO Melissa Byrne said strong private investment is essential to getting more projects underway and meeting the National Housing Accord target of delivering 1.2 million new homes before the end of the decade.

“The Government’s tax increases on property, investments and trusts will not boost confidence in the sector and, according to Treasury, will reduce housing supply.

“These changes will dampen private investment, resulting in fewer new builds, reduced rental supply and higher rents.

“Builders need holistic policy measures and continue to call for an accelerated depreciation of capital works and an increase to the Instant Tax Write Off to $150,000 to better support small business investment and cashflow, as well as productivity,” said Ms Byrne.

Media contact: Dylan Hafey, Media Advisor

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