The ABS has just released data on the value of construction work done for the December quarter of 2012, which registered a seasonally-adjusted -0.1% fall in total construction activity over the December quarter but a 11.9% increase over the year. Analysts had expected a 1.5% increase over the quarter.
The fall in overall construction activity was driven by a sharp decline in engineering construction, which fell by -1.3% over the quarter. By contrast, building construction increased by 1.8% (see below charts).
Western Australia drove the fall in construction activity, registering an -8% decline over the quarter, most likely driven by a fall in engineering (mining) construction activity. However, Western Australia’s fall was mostly offset by large increases in Victoria (+5%) and the Norther Territory (+29%).
Overall, the data suggests that the mining investment boom that has powered the Australian economy might have peaked. While this has so far been offset by increased building activity (including housing construction), doubts remain over whether housing will be able to fill the void should the slowdown in engineering (mining) construction gather pace.