Construction industry to face skills shortage on back of residential construction boom

The construction and property services industries are facing a severe skills shortage over the next three years, and more 457 visas will be needed to fill the workplace gap if nothing is done, a new report has warned.

The warning from the Construction and Property Services Industry Skills Council (CPSISC) comes as the group expects an uptick in residential construction over the next three years, which will fuel a large demand for construction work and ancillary services.

The property industry has been on the back foot during the few years, which has impacted on services business. Recent auction results have indicated a recovery.

The research released today by the CPSISC, and modelled by the Centre for International Economics, predicts the industry faces an increase of 45,000 jobs over the next three years.

The industry is expected to see employment increase by 1.5% every year until 2016 – but the CPSISC says this can be improved, as the industry isn’t ready to meet that demand.

The report says while these 45,000 additional jobs are welcome, they “do not directly replace the gap caused by recent shortfalls in apprenticeship flows and aged attrition trends occurring over the next decade”.

The CPSISC says the government needs to encourage incentives in order to grow that number even more, including workplace development programs.

The benefits are laid out in the report, which claims a 1% productivity increase to the construction industry would add $2.36 billion a year to the national GDP.

Given property services are tied closely to the construction industry, such a boost would have a positive, widespread effect on the economy.

Nick Proud, the CPSISC director of policy, told SmartCompany the industry is in a state of change and requires more support.

“Apprentice numbers are down, so you have a huge group that isn’t being trained at the front end,” he says. “We’re also seeing the tail end of some of the work cycles of our tradies.

“That’s another issue, in terms of keeping them in the system for longer.”

Proud says if there are not enough apprentices being trained, the economy will have to depend on 457 visas to complete construction, “and we don’t want to go down that path”.

“At the end of the day, there are a lot of industries such as manufacturing that are starting to come off the boil. We need to be thinking of policies that will facilitate more work there.”

“There isn’t a shortage today. But there may be in the future… and it means we need to invest in workplace development.”

The CPSISC wants the federal government to cut costs for compliance and scrap industry specific taxes. But Proud says given the predicted shortage, the council fears there may be backlash.

“Because these shortages aren’t there now, this could lead to policy settings where the government says, “we should just see what happens”.

“But we shouldn’t just see what happens. We need to invest in workplace development now.”

The report argues for more workplace development industry programs, along with improvements to productivity.

“Workforce development investment today and continued investment across future terms of state and federal governments, as well as by employers, is really the line drawn under the report, ensuring that bottlenecks in activity do not threaten forecasted upswings,” Proud said.

Demand is set to be highest among construction managers, carpenters and joiners, painting trades workers and plasterers. Surveyors, engineering professionals, civil engineering draftspersons and bricklayers are also expected to be in high demand.