Residential construction collapses

The ABS has released data on the value of construction work done for the September quarter of 2020, which registered another 2.6% seasonally-adjusted decline in total construction activity over the quarter – the ninth consecutive quarterly decline – and a 4.2% decrease over the year:

However, the result disappointed analysts’ expectations of a 2.0% decline in construction activity over the quarter.

The 2.6% quarterly decline in construction activity was broad-based, with both building (-2.0%) and engineering (-3.3%) falling:

Residential construction has fallen for nine consecutive quarters and is down 18.1% from peak:

All jurisdictions except Northern Territory reported falls in construction over the September quarter, with VIC (-6%) the worst state and South Australia (-1%) faring best:

The most important information to come from this release is that construction activity should detract from the September quarter’s GDP growth, which is due for release next week.

Unconventional Economist
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