COVID-19: HIA flags September jobs hit for builders, tradies
Melbourne builders have been warned they have until September to prepare before the number of new homes being built across the city is halved and tradies see their hours slashed.
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Melbourne’s home builders have been given a stark warning only half the new builds expected to take place in the second half of 2020 will proceed.
And one of the industry’s largest lobby groups has warned it will prompt a “significant reductions in work hours”.
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New figures from the Housing Industry Association show that in addition to a 22.8 per cent reduction in new home sales since COVID-19 restrictions were implemented, 30 per cent of those who had already committed to build a new home have also walked away.
As a result the industry group is now expecting just half the homes forecast to be built in the second half of 2020 to proceed, with tradies to see hours slashed from September.
HIA chief economist Tim Reardon said cancellations were at double the level seen during the global financial crisis of 2009 and the property market correction of 2018, and signs of a surplus in the workforce were already emerging.
“Even the removal of all COVID-19 restrictions will not prevent a material deterioration in work and employment in the home building second half of 2020 and 2021,” Mr Reardon said.
The figures were obtained from surveys with the nation’s top 100 builders and correlate closely to what is expected in Victoria.
But while it’s tradies around Australia will see hours slump from July those in Melbourne have until September to prepare, according to HIA Victorian executive director Fiona Nield.
“There will be tradies who will see significant reductions in work hours on building sites in the second half of 2020,” Ms Nield said.
Figures released by the Australian Bureau of Statistics earlier this week show the number of new units approved for development in Victoria rose 0.7 per cent in March, and houses were up 0.1 per cent.
However they are expected to be negative in April, ending a short-lived recovery in approval numbers that began late in 2019 following almost two years of falling numbers from the end of 2017.
In a silver lining for the industry, the state government earlier this week quietly confirmed display homes could be reopened in line with open for inspection rules established for the wider real estate market.
However, Urban Development Institute of Australia Victoria chief executive Danni Hunter said large-scale job losses could still spread across the development industry — one of Victoria’s top five employers — if homebuyer confidence did not return soon.
“Government must do everything it can to responsibly lift market sentiment, and let buyers know the housing market is still open for business,” Ms Hunter said.
A six to nine month delay from new home sales to construction commencing means even once home sales pick up the industry will continue to struggle for some time.