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Date PostedMay 27, 2015

Building Activity to ease in 2015 but Remain Respectable according to ACIF

According to the Australian Construction Industry Forum (ACIF) building and construction activity throughout Australia in 2015 are set to vary according to geographical location and sector in which contractors find themselves.

The ACIF released its Construction Market Report December 2014 which explained that the overall dollar value of work done in the construction sector nationwide is probably going to cool from $233 billion in 2013/2014 to $228 billion in 2014/2015. While this is a slight decline, it is still a very respectable figure according to the ACIF.

The ACIF does however warn that although construction activity over the next year is still positive, there are some disparities between the activity recorded in different sectors within construction and in varying geographical locations.

For example the ACIF predicts growth in detached housing particularly in New South Wales and South-East Queensland. They do however warn that activity in the commercial construction sector will probably cool in these states. An expected decline of 6.8 per cent between now and 2018/19 is expected in civil construction for these locations.

In an article on construction website Sourceable.net the ACIF is recorded as stating that some contractors and suppliers of the mining sector may be negatively affected but small home builders should benefit, together with tradies in the detached housing sector such as bricklayers, plasterers, tilers and residential landscapers and site management.

Peter Barda the ACIF chief executive officer explained that soft conditions would be prevalent in most of the globe but Oz would slowly grow. In the short term this would have on positive aspect, it would keep interest rates low.

Mr Barda went on to explain:

“Global economic growth has been revised downwards following lower than expected growth in the first half of 2014,”Barda said. “Australia’s economic growth of 2.5 per cent in 2013-14 was generally in par with what we had foreshadowed six months ago.”

“However, a sluggish recovery in Europe and a strong domestic currency means that interest rate rises are likely to be deferred to encourage consumption spending until at least the end of 2014-15 – a later date than thought earlier in the year.”

See more at: http://sourceable.net/winners-and-losers-in-2015-construction-outlook/#sthash.SRCnssub.dpuf

The article went on to highlight some key points in the forecasts from the ACIF. One of the crucial aspects highlighted was the fact that the dollar value of construction work done throughout Oz will contract slightly from $233 billion in 2013/2014 but in comparison with historic standards, they will remain reasonably high.

Some of the other key points include:

  • Strong growth will continue in residential construction until a firming of interest rates returns growth to underlying trend rates in 2016/17, with the dollar value of work done set to rise from around $75 billion in 2013/14 to around $90 billion in 2017/18. The previously flat detached housing sector will be the biggest area of growth expanding from around $26 billion now to around $33 billion by 2016/17.

  • Following a moderate growth spurt in 2014/15, the dollar value of work done in the commercial building sector is expected to flatten out and grow by only 0.6 per cent over the next decade, with recent growth in retail set to flatten out and flat activity expected in office building except for a modest growth spurt in 2016/17.

See more at: http://sourceable.net/winners-and-losers-in-2015-construction-outlook/#sthash.SRCnssub.dpuf

New South Wales is expected to continue to experience strong growth whilst Queensland will be impacted by the decline in resource work notwithstanding strong housing activity in the South East.

The article concluded by explaining that Western Australia is expected to be reasonably subdued compared with recent historic highs whilst Victoria is expected to experience some moderate growth.

Given the disparities between activity in various locations, it is extremely useful that the construction white card, which is the mandatory safety induction card required for work in the construction industry in Oz, is valid nationally.

The white card is accepted on construction and building sites across all states and territories which means that workers can easily move across borders or seek work in other parts of the country as the demand for their skills shifts from location to location.

Peter Cutforth is a Director at Urban E-Learning, a global elearning and web strategy firm based in George St Brisbane. Peter's interests extend to training, safety and compliance, online marketing, and Mobile Apps.

Posted in Blog, White Card News