AUSTRALIA’s leading labour market forecasting firm predicts a high level of construction skills availability during 2014 due to project completions, labour displacement from other industries and the slowing rate of new investment coming to market.
The latest data from Pit Crew Management Consulting shows that Australia has 350 major resource industry and related infrastructure projects either awaiting approval or already under construction worth a total of $617.1 billion.
Construction of these projects will require about 66,500 workers during 2014-15, but in stark contrast to the widespread skills shortages seen less than two years ago, Pit Crew founder and director Peter Dyball says this demand should be comfortably met.
“Demand levels are easing as a result of projects reaching completion or reaching their peak and progressing towards the latter stages of completion, as well as a reduced number of (new) projects in the pipeline,” says Dyball, whose firm releases the biannual AREEA Pit Crew Labour Market Index in partnership with the resource industry employer group.
“Increased availability is due to a range of conditions from both within and outside the major project sector. Within the sector the easing numbers on projects is freeing up of labour. Outside the sector in areas such as operations and manufacturing, easing markets, cost-cutting and optimisation are also providing a greater availability for the major projects construction sector.
“It is worth noting that an easing construction market will be somewhat counteracted over time by growth in the operations requirement as new assets come online.”
The Pit Crew data estimates Australia’s relative availability of construction skills is at 22% surplus, with only the Northern Territory experiencing ongoing shortages (-8%). The two major mining states, Western Australia and Queensland, have construction labour surpluses of 28% and 10% respectively.
However Dyball warns that the availability of workers in the future can rapidly change with factors such as natural attrition, mobility, other sector activity and unexpected changes in the project sector. He also says the supply sectors to major projects are having an impact.
“When project sites need labour, service providers and suppliers will generally also need labour, reducing the available labour in the market and pushing shortages,” he says. “An easing market sees availability similarly affected by suppliers and contractors letting workers go, as soon as order books aren’t full, resulting in higher availability of workers.”
The full AREEA Pit Crew Labour Market Index analysis can be found here.
