SA faces battle for workers to meet building boom demand

Construction is booming in SA but there is a still an uphill battle if the state’s big moneymakers hope to capitalise.

The booming construction industry is desperate for workers to complete building projects across the state, ahead of a new wave of major projects that threatens to put even more pressure on the escalating skills shortage.

Government stimulus programs have delivered a healthy pipeline of work to residential and commercial builders, but prolonged border restrictions have limited the supply of workers needed to deliver the record level of development.

And with several major projects in the pipeline, including the Torrens to Darlington motorway, new Women’s and Children’s Hospital and Entrepreneur and Innovation Centre at Lot Fourteen, there are growing fears the shortage of workers is going to become even more acute.

Housing Industry Association SA executive director Stephen Knight said the 10-year Torrens to Darlington project would require 1000 construction workers by the end of this year, rising to a peak of 5000 in 2026, with many expected to be brought in from the residential and commercial construction sectors which were already finding it hard to find workers.

“Our sector is already suffering skilled labour shortages and will continue to do so even without Torrens to Darlington – we have an ageing workforce and a lack of skilled migration,” he said.

“There’s $17.9 billion of investment in infrastructure projects in SA getting under way in the next four years, and all types of residential construction workers will be sucked up by these projects.

Badge SA state manager Bradley Watts, security technician Rico McFarland, undergraduate Emma Billing and Site Manager Tye McIvor on-site in Mitchell Park. Picture: Matt Loxton

“Attracting young people to apprenticeships in construction is already a challenge, and with defence and other industries competing in the same space it will only become more difficult.

“There has been great work done over the last few years in increasing apprentice and trainee numbers but this is clearly not going to be enough, we need more skilled construction people on the ground now.”

The HomeBuilder scheme has fuelled a record level of new housing projects across South Australia, while the state government’s $1.5bn investment in school upgrades has kept commercial builders busy during the pandemic.

At the same time, a near two-year long ban on international travel and prolonged interstate border restrictions have limited the flow of skilled workers into the state.

Badge Constructions, which is overseeing major projects including Thomas Foods’ new meat processing facility near Murray Bridge and the $57m Wulanda Recreation and Convention Centre in Mount Gambier, is currently looking to recruit project managers, site managers and contract administrators as it gears up for a strong pipeline of work.

Badge SA state manager Bradley Watts said the war for talent was heating up in the construction industry, with builders competing for a limited number of candidates.

“It’s really about getting the right people for the job, and for the right people, they’re hard to come by at the moment,” he said.

“Employers know they’re good people and they want to hold on to them. Not only locally, but nationally, staff retention is becoming a real issue, and with a limited supply of quality candidates you have to focus on what you’ve got and do the best with the team available.”

Mr Watts said the reopening of borders would offer some respite in the short-term, but more apprentices were needed to support the industry’s longer term needs.

“With the opening of domestic borders we’ve probably seen a slight increase in supply, and we’re just hoping with international borders reopening, that will supply the national market with more resources and hopefully that will flow into SA.”

If we build it, will they come?

By Cameron England

South Australia will face a war for talent, driving up wage costs and hindering the state’s ability to capitalise on growth projects if the skills and labour shortage is not addressed urgently, businesses and lobbying organisations say.

Rebuilding the international tourism sector, collaborating with industry on long-term infrastructure plans, growing exports, and embracing digitisation of the economy were also among the ways to fire up the state, business leaders said.

William Buck Adelaide managing director Jamie McKeough said SA needed policies in place which attracted a “much higher proportion’’ of skilled migrants to the state than we’d achieved in the past.

“Effective policy initiatives that encourage skilled migration to South Australia are critical for the medium and long-term viability of our local economy,’’ he said.

Tax reform was also over due, he said.

“Our political leaders need the courage to lobby for federal tax reform, particularly around increasing the rate of GST, which will allow continued reform at the state level including abolishing payroll tax.’’

Adelaide Airport managing director Brenton Cox said rebuilding the state’s international networks would be critical.

“The pandemic has completely changed the landscape of global aviation, and we again have to demonstrate to international carriers that we are an attractive destination in what is a fiercely competitive aviation market,’’ he said.

“This should not be underestimated as we focus on rebuilding connections across the world for all South Australians.’’

T2D Torrens to Darlington North South corridor. Picture: Supplied

Labour shortages were cited by virtually every business leader as a key issue in sectors of the economy which had not been adversely affected by the pandemic.

BankSA’s State Monitor, released last week, identified that operators in high-demand sectors, such as transport, construction, manufacturing and finance, were having to compete with other firms for staff.

BankSA state general manager business David Firth said companies were having to pay above the odds for staff in some sectors, and were finding that they were having to compete with other firms for skilled workers.

Business SA’s pre-election charter includes the perennial call for cost reductions and payroll tax relief – including a call for a 50 per cent payroll tax rate for regional areas – but chief executive Martin Haese told a recent pre-election event that skills and labour shortages were hitting hard.

While commending the state government for incentives which make it more affordable to employ apprentices, he said it was “critically important’’ to attract and develop more skilled staff.

He also called a for a stronger focus on export growth.

“Exporters proportionately employ more South Australian,’’ he said. “We need to be an outward-facing economy.’’

He also backed “moderate, sustainable population growth’’, pre-empting a call from Committee for Adelaide chief executive Bruce Djite that the state needs to grow its population to two million by 2030.

The South Australian Chamber of Mines and Energy is also concerned about skills, advocating for the urgent development a workforce plan that sets out the requirements of key industry sectors.

SACOME also wants a strategy on “energy transition” to support the ongoing operation of the state’s oil and gas sector while incorporating new energy sources and supporting heavy industry to decarbonise.

Flinders Ports chief executive Stewart Lammin said SA should invest in making itself a digital leader, including AI-assisted port operations

“Change is coming,’’ he said. “This is a significant strategic opportunity for our business and for the state.

“I’d urge any incoming government to continue supporting this productivity enhancing network being built out here. We think SA has an opportunity to be a serious early adopter in this space due to the relatively integrated and connected make up of our supply chain infrastructure.’’

The Master Builders Association of SA, in its pre-election submission, says helping apprentices from a disadvantaged background get their driver’s licence would be a simple and effective strategy to help get people into skilled work.

It is also advocating for the creation of a specific apprenticeship for concreting.