Olympic tradie shortage threatens as next Australian housing crisis
Australia’s tradie shortage is on the cusp of turning into the nation’s next housing crisis, with building industry powerbrokers revealing it’s a bigger concern than fuel supply today.
A surge in demand expected to be centralised around Queensland in the lead up to the Brisbane Olympics already has two of the nation’s biggest builders on the defensive, with fears it could make today’s fuel supply issues look like a lesser issue — and will be a problem for construction country wide right up until the games six years from now in 2032.
Hutchinson Builders have revealed they are actively turning down work from developers planning to tackle projects in timelines they see as likely to compete for tradies against major building pipelines for the Games and for infrastructure and hospital projects in the state.
RELATED: Australia 77,500 homes short of crucial housing target after $110bn record
Iran war adds $5k to Aussie home build cost, bigger $31k hike ahead
Albo’s 21k tradie headache to hit interest rates
Scott Hutchison said he was already knocking back close to half the developers who came to them with projects and was hoping fuel concerns would slow down the rate of apartment projects coming online in Queensland that would conflict with demand for infrastructure projects in the lead up to the sporting event.
“If that cools down, that will make the Olympics easier to swallow,” Mr Hutchison said.
“After Covid the demand went through the roof and there was a huge increase in costs. These fuel costs are annoying, but there’s nothing there like having that explosion in demand.”
He said while he was hopeful demand would reduce, he was also optimistic that they would get more building industry workers shifting to Queensland as need for their services rose.
Noting that their firm did not rate Sydney or Melbourne as having similar demand for trades in the timeline, he said they were hoping to get more workers to south east Queensland.
Hutchinson Builders chairman Scott Hutchinson says he’s hoping Queensland will be able to lure more builders interstate to cope with demand. Picture: Liam Kidston.
While a tradie migration has been expected for some time as a part of the upcoming demand for work ahead of the Olympics, Mr Hutchison said next year through to 2032 seemed a plausible timeline.
Meanwhile, the nation’s biggest home builder Metricon is already working to combat a trades raid by the Sunshine State so it can keep home building on track across the country.
Chief executive Brad Duggan said the threat of tradies being lured to Brisbane and Gold Coast infrastructure projects was “definitely” on their mind, from both Victorian and Queensland projects.
“There’s significant risk in relation to that — it’s not the hardest place to entice people to go to,” Mr Duggan said.
“2032 isn’t that far away and it’s been on our risk radar for some time — but it could be its as early as next year.”
He said the firm was looking to provide consistent and well planned work for all their trades, to make it less appetising for them to want to head north — even if offered better wages.
“We can’t combat against the sun or higher wages, but what we can do is be a great place to do business,” Mr Duggan said.
Metricon CEO Brad Duggan says his firm is already taking steps to address the “significant risk” that workers will be drawn to Queensland in the coming years. Picture: Richard Walker.
He also warned that the nation’s current fuel crisis was risking making the coming demand for trades issue even worse, with reports around the industry that apprentices were being let go by smaller building operators as they struggled to account for rising costs against fixed contracts.
For those hoping to build a new home to live in, he said signing on to build a new home under a fixed contract as soon as possible was the best defence against rising prices caused by the conflict in Iran.
“We will see a lot of pressure across our supply chain, they are all encountering accelerating costs, but we are doing everything we can to keep prices as low as possible,” he said.
However, he did not rule out price rises.
Victoria’s biggest home builder, and another of the nation’s building industry heavyweights, Mirrastone, are already noting “minor” increases in price for new contracts — though they too are working to minimise costs being passed on.
Chief executive and managing director Nathan Jenkinson said increases so far had been nowhere near what had been encountered in the post-Covid building boom and that most builders had learned from that experience, meaning they were avoiding overextending again.
Tradies are expected to be in such high demand over the next years it will impact construction of homes and infrastructure projects.
Mr Jenkinson said they were now having daily conversations with suppliers instead of fortnightly to anticipate problems before they hit as they worked on close to 2000 new home builds.
After the fire at Geelong’s Viva Energy refinery he said it was too soon to tell if it would have an impact on the building sector, but that initial reports did not sound positive.
Master Builders Australia chief executive Denita Wawn said Australia had an “insufficient number of new workers” joining its building workforce, and was currently not prepared for the huge step up in demand ahead.
“Without action, Australia risks simply reshuffling an already limited pool of skilled trades rather than growing it,” Ms Wawn said.
“There is still time before 2032 to get this right. However, despite the government’s efforts, we are still far from where we need to be to meet the housing, Olympic and infrastructure demands to come.”
Australia is already struggling to build enough homes to meet national construction targets.
She said extending apprenticeship incentives past the end of this year, more programs aimed at attracting youths at school into trades and more skilled migration support would assist.
“Even with significant reform to local vocational education and training, it will take three to five years before additional apprentices or graduates translate into fully qualified tradespeople,” Ms Wawn said.
“If done right, Activate Australia Skills estimates an improved skilled migration system could deliver 2.4 houses per skilled migrant.”
Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest Victorian property market news delivered direct to your inbox.
MORE: Prices slashed on The Block’s failed auction homes in Daylesford
English (US) · 