Skill shortages to be the “defining issue” for Australia’s construction sector

The high-profile collapse of Probuild and Condev has shone a light on the perfect storm facing the Australian construction industry, with rising costs and supply chain issues putting pressure on many firms.

And now there is a new threat to add to that list: a worsening skills shortage.

Global consultancy Arcadis has warned a “severe shortage of construction workers” will present a huge challenge to the industry over the next decade, with job vacancies increasing by 80% since late 2019.

As a result, more than 100,000 roles are forecast to be unfilled in the sector by 2023 – almost 50% greater than the number of people expected to be qualified to fulfil them.

Arcadis’ executive director of cost and commercial management, Matthew Mackey, said Australia’s construction sector had largely recovered from the pandemic. However, that recovery was coming with an inflationary cost.

“The biggest issue for construction costs in the near term is fluctuating energy and commodity prices, which flow through directly to key materials like steel, timber and concrete. These are US dollar costs and are not something over which Australian contractors have a lot of control,” he said.

“Looking ahead, we see skills and labour shortages as being the defining issue for the construction sector over the next decade.”

Adam Zuchowski is a disputes lawyer and principal at Sutton Laurence King Lawyers.

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