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NZ building boom needs higher-skilled workers - report

Wednesday 19 Oct 2016 10:56 a.m.

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Kiwis should stop favouring bespoke builds and become more comfortable with the concept of high density living in similar-style, modular homes.

That's just one of the recommendations from a construction industry report out on Wednesday, aimed at lifting productivity to sustain growth.

It also wants more emphasis on construction as a career choice for the highly-skilled, and more opportunities for education and training.

"Think of the construction sector's 8 percent GDP contribution to the economy as the same as the whole of the Waikato region. This is huge and the construction sector is continuing to expand," says Geoff Hunt, chairman of Construction Strategy Group, who co-commissioned the report.

"Job creation, and especially higher-skilled workers will also encourage new investment to the flow and the extra scale the construction sector needs to achieve maximum productivity and consistently high quality performance."

Core construction has contributed to 26,000 new jobs between 2012 and 2015. In comparison, other traditional industries such as agriculture, forestry and fishing only offered 330 new jobs over the same period.

Mr Hunt said the need for more highly-skilled workers in the industry is an ongoing problem. He says there's a general lack of awareness around the high level of skills needed and the opportunities available.

"New Zealand is the land of the cheap, so when we procure for today, we're not actually thinking about tomorrow's workforce and there's a big lag between taking say a school leaver and getting to a fully productive skilled worker," he says.

"We somehow need to build into construction the cost of training people for the future. The only other alternative, and it has to be part of the solution, is immigration."

The report says the Government could plan its investment programme to support the industry in a downturn and work with other governments like Australia to fill labour shortages where demand is countercyclical and labour is mobile.

More women on building site

Wednesday's report also reveals how more women are entering the construction industry in skilled roles, a big difference from five years ago when the last report was produced.

"One of the highlights was the 45 percent increase, or almost 5,000 jobs in the number of women in construction roles," says David Kelly, chair of the Construction Industry Council, which has co-commissioned the report.

Building boom set to continue

"Projections also suggest we will need an extra 49,000 construction jobs by 2021 to meet demand from things like the Christchurch rebuild, earthquake strengthening, pipeline of infrastructure projects, and significant residential demand in Auckland, which all adds up to sustained growth," Mr Kelly says.

The report explores several challenges the industry needs to overcome to avoid the boom-bust cycle of recent decades. This includes a predominance of small firms in the construction sector and a lack of specialisation. This could be overcome with more collaboration or builders joining forces to work on bigger developments.

There also needs to be more acceptance of mass customisation and standardisation to maximise opportunities for scale and more use of standardised contracts for developments.

"The current building industry boom is likely to continue given the Proposed Auckland Unitary Plan provides for the additional 422,000 dwellings over the next 30 years," said Mr Hunt.

"We expect that the value of construction work will peak in 2017 at $37.2 billion with almost half the growth coming from the residential housing in Auckland."


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