Australia’s economic transition away from the “over-dependence on mining related construction” continues to progress, a new report has suggested.
The Housing Industry Association (HIA) and Cordell CONSTRUCTION 100 report presents an in-depth analysis of the engineering construction, non-residential building and apartment sectors.
The findings suggested that while the end of the mining boom delivered a “sizable hit to construction activity in Western Australia”, it hasn’t been all bad news.
“The recovery in the housing market has played a huge role in the early stages of the transition, but we are now moving into a new stage,” said HIA chief economist, Harley Dale.
“Arguably, this has been occurring more smoothly than many would have believed possible.”
While construction was picking up in other parts of the country, including upgrades to Melbourne’s rail infrastructure, the Toowoomba second range crossing project and Sydney’s Westconnex and light rail network, “the Forrestfield-Airport Link project [in Western Australia] was amongst the largest projects of the year”.
“The buoyant conditions in the key east coast housing markets also saw a substantial increase in the number of property transactions,” added Mr Dale.
He added: “With state governments taking a clip on every transaction, stamp-duty revenue growth over the last couple of years exceeded even the most optimistic of forecasts. While finding a replacement to this highly inefficient tax is an obvious policy reform priority, this revenue windfall for state governments on the east coast has been instrumental in funding the growth in infrastructure.”
“Hopefully, this could pave the way for a broader recovery in non-mining private sector investment in the next phase of the transition,” Mr Dale concluded.
The report also profiled the largest 100 companies operating in these fields, with CPB Constructions topping the list, having been awarded contracts totalling $13.59 billion, and Lendlease (Building, Engineering and Services – Australia) ranking second, with contracts totalling $8.29 billion over the course of the year.
[Related: Housing commencements reach record high]