With several major government-led transport infrastructure projects set to be rolled out, thousands of small construction businesses across Australia will get the necessary boost, reveals the latest Master Builders Australia Forecasts report.
According to Shane Garrett, Master Builders chief economist, the 2019/20 to 2023/24 report indicates strong expansion for engineering and civil construction activity until 2021/22 – its strongest since the mining investment boom at the beginning of the decade.
“As a result of record activity in natural resources investment, the volume of engineering construction had peaked at $142.8 billion in 2012/13. The subsequent slump was heavy, involving a 38.6 percent reduction in activity,” Garrett says.
New data reveals that engineering construction activity has been battling tough conditions; however, the eventual roll-out of government-led infrastructure projects will see growth return in the near future, he says.
“We forecast that the volume of engineering construction work will expand by 12.5 percent by 2021/22 compared with 2018/19. Thereafter, activity will ease back as the pipeline of infrastructure work comes to an end.
“Both road and railway construction work will see big gains over this period, while the completion of the NBN means that telecommunications related activity will slip back,” Garrett says.
Though growth is expected to return to the construction sector, Garrett believes the government needs to get things moving on the ground with more urgency, especially when it comes to small and medium-sized infrastructure projects. Additionally, a speedier roll-out of infrastructure projects by government would give the wider public real and visible evidence that the economy continues to move forward, Garrett says.