The construction industry is desperate for more tradies as the home renovation and building boom stresses the workforce, delaying projects by months.
Jobs board Seek has tracked the highest number of job advertisements in its 25-year history over March, with the Trades and Services industry driving most of the available jobs.
Seek ANZ managing director Kendra Banks said skilled tradies – electricians, labourers, and automotive workers – are in highest demand.
Builders say they’re in dire need of workers, as staff shortages are pushing up wages and making it more expensive to build and renovate client’s homes.
In-demand tradies hold the power
Rebecca Bishop and her husband have been running their Gippsland-based construction company, Elite Building Services, since 2013.
She said although the HomeBuilder scheme introduced in 2020 was a “wonderful boost” for the construction industry, it put too much pressure on workers and materials, leading to shortages of both.
As a result, Ms Bishop’s construction times blew out from 16 weeks to up to six months – on average – as she was forced to wait months to buy basics like windows.
The industry is in “desperate need” of more tradies too, she said, with those toiling through COVID already “working themselves to death”.
“There always has been a bit of a shortage with brickies and concreters, but this is beyond anything we’ve ever experienced,” Ms Bishop said.
“Tradies hold the key at the moment because they can pick and choose what jobs they do, because they’re just in critical demand.”
All that demand has put tradies in good stead to bargain for better pay rates, Ms Bishop added, because “there is no alternative”.
But higher wages and material shortages are also making it more expensive to build a house – stretching many firms to their limits.
CoreLogic data shows national residential construction costs – largely driven by timber, metals and imported products – rose 9 per cent in the 12 months to March, the highest growth rate since 2001.
Several high-profile building companies have succumbed to the stress lately, in the commercial and residential building spaces.
Reporting bureau CreditorWatch said on Wednesday that suppliers are keeping a close eye on builders’ debts to monitor their financial health.
Demand for construction workers to continue
Making matters worse, Barrenjoey chief economist Jo Masters said high demand for renovations and home building has created a backlog of projects, with demand unlikely to slow until next year.
Ms Masters said a combination of record-low interest rates, HomeBuilder grants and high pandemic saving rates have created increased appetite for renovations and home building.
Meanwhile, governments have splashed hundreds of billions of dollars on large infrastructure projects to prop up the economy through COVID-19.
Macromonitor economist Natalie Senga said non-residential building and transport infrastructure projects are key drivers of the building boom.
The industry will see “consistent growth” until June 2023, she said.
High worker demand
Ms Masters said Australia is seeing labour shortages as a result of strong economic growth “right across every sector of the economy”.
“We’ve got an economic growth cycle that is very jobs-rich; it’s creating a lot of jobs,” she said.
Seek data shows while job advertisements rose 5 per cent month on month in March, applications per advertisement fell by 4.5 per cent.
Job advertisements on Seek recorded a monthly increase in March in all 28 industry categories on the site.
Following Trade & Services, the Hospitality & Tourism and Healthcare & Medical industries rounded out the parts of the economy hiring the most.
Committee for Economic Development of Australia chief economist Jarrod Ball said “there is plenty of momentum” for a continuing decline in the unemployment rate (currently 4 per cent) over coming months.
“The flip side of these numbers is that skills and labour shortages are real – candidate availability has been on a downward trend for two years now,” Mr Ball said.
“Policymakers need to be looking at how we lift the quality and accessibility of domestic training options, particularly on-the-job training for young people.
“We also need to see a swifter return of skilled migration to alleviate acute skills shortages in areas like technology.”
