Earlier this month, the ABS released construction materials data, which showed ongoing weakness in the production of concrete blocks, clay bricks, roof tiles, and plasterboard – items typically associated with housing construction (see next chart).
Today, the Housing Industry Association (HIA) has released its March quarter Trades Report, which is a quarterly measure of trade prices and availability on a capital city and rest of state basis for 13 different trade categories in the 5 largest states. The data is sourced each quarter from a sample of HIA builder and contractor members. The price series is the current charge out rate minus GST and materials, whereas the trade availability measure is derived from a question asking members about the availability of their trade in their particular region.
According to the HIA Media Release:
The HIA Trades Report, a quarterly survey of builders and sub-contractors, indicates a relatively high availability of skilled labour continued into the first quarter of 2013, while developments in trade rates were benign.
“Skilled trades people continue to operate in weak conditions – residential construction experienced declining activity in 2012 and while there are signs of a recovery in 2013, it is from a very low starting point,” said HIA Economist, Diwa Hopkins.
“An adequate provision of skilled labour will be a crucial ingredient to a recovery in new home building that is of the magnitude required by Australia’s longer term housing needs,” said Diwa Hopkins.
“A prolonged period of inadequate residential construction activity is not conducive to attracting new skilled labour into the industry, and this may undermine the longer term capacity of the industry to meet recovering demand. Improved support now for training will play an important role in mitigating this risk,” added Diwa Hopkins.
The HIA Trade Availability Index eased slightly from +0.22 at the end of 2012 to +0.19 in the March quarter this year, meaning that trades were still in moderate oversupply (readings greater than 0.0 indicate oversupply). The current soft conditions in the residential construction industry are also reflected in the relatively mild improvement the HIA Trade Prices Index. The Index increased by 2.7 per cent in the March 2013 quarter, off a very low base, to register an annual growth rate of 1.1 per cent.
Media Release below.
