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    Australia’s construction sector slows down

    A new report has shown that Australia’s construction sector slowed down at the end of 2017.

    The latest Performance of Construction Index from Ai Group and Housing Industry Association saw an ease in activity by 4.7 points to 52.8 in December. Put in context, any reading above 50 points indicates expansion.

    This recent reading marked an 11th consecutive month of expanding conditions, but with a slowing in the industry’s overall growth momentum.

    Across the four construction sub-sectors, engineering construction (down 7.2 points to 56.9) and house building (down 6.8 points to 54.5) remained the strongest performers, but the pace of activity growth in both sectors was well down on November’s increases.

    The rate of expansion in commercial construction also slowed (down 8.3 points to 51.5), while apartment building improved its performance to record a slight rate of growth (up 3.0 points to 50.7.

    Overall construction activity dropped 6.2 points to 54.6 from November’s historic high, while demand conditions were also more subdued with the new orders sub-index entering the negative territory (down 7.5 points to 49.2). 

    “Looking at 2017 as a whole, even with the steady retreat in apartment building, construction activity was robust through the year. While the pace of growth may well ease, continued healthy levels of work across the industry look set to see a solid start to 2018,” says Peter Burn, Ai Group’s head of policy.

    In July 2017, construction in Australia grew at its fastest pace in 12 years (a rise from 4.5 points to 60.5 points).

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