Drop in much-needed investment

South Australia’s commercial building sector needs a new series of projects to fill jobs likely to suffer from a 10 per cent fall in activity, Master Builders SA says.

Data released today by the Australian Bureau of Statistics shows new non-residential construction activity in the State has fallen more than 10 per cent to $1.2 billion for the year to December 2016. Of most concern is the 23.8 per cent fall in private investment in commercial construction, Master Builders SA Chief Executive Officer Ian Markos said.

“Investment in offices, warehouses and schools marks investment in the next generation of productive infrastructure, so to see this rapid fall is a concern for the jobs connected to that activity,” he said.

“We need to identify the projects that will add value in the State and invest now to trigger more confidence from the private sector.

“Master Builders SA presented the State Government with a reform package aimed at boosting the health of the sector more than 12 months ago – the time is right for these essential changes, for home owners, for apprentices and the State’s small businesses.”

Residential construction activity provides good news for the State with recent improvements in building approvals now being reflected in activity on the ground.

“Residential construction is about 10 per cent higher than 10-year averages, with $762 million of activity in the December quarter alone,” Mr Markos said.

“This represents a lot of projects across the State and filters down to South Australia’s vital small business community, so the next challenge for Government and industry is to make sure that any red tape holding back that flow of activity is cleared away. Planning reforms are a good start to the next 30 years, but our members are still dealing with problems today that are adding costs to projects and impacting housing affordability.

“This is a key challenge – we need to get it right to underwrite the State’s future.”

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