• We expect the Total construction projects market (building and civil engineering projects, excluding the detached housing sector as well as mining, oil and gas) to show steady growth of 8.2% in the upcoming financial year 2018/2019. This compares with a healthy increase of 11.7% for the current financial year ending 30 June 2018.
• Building construction fared slightly better than we had expected in 2017/2018 with a year on year increase in the value of commencements of 3.8%.
• Growth in Residential peaked around the end of 2016 and we see the decline continuing through the 2018/2019 financial year but with continued improvement in the non-residential categories such as Hospitality, Industrial and Health, we expect a modest increase of 4.3% overall.
• Civil engineering construction (including infrastructure, transport and utilities) has been the significant growth engine for the industry in recent years, improving 96.0% in 2016/2017 and 24.5% in 2017/2018. With continued strong government commitment, we are expecting a further 13.4% growth in 2018/2019.
• Current workloads vary across the country – with NSW and VIC quite strong and QLD and WA weaker – but have improved, especially for Architects.
• The order situation expected in 12 months is also improving generally although Builders are only expecting their levels to remain the same.
• Market conditions overall do not appear to be favouring any particular construction category although Commercial is marginally in the lead and Builders are feeling headwinds in the Residential market.
• Company Tax Cuts are seen by the majority of our respondents as beneficial to the construction industry – indeed 37% overall said “very beneficial” .