Our missing tradies: 90,000 needed now to meet nation’s housing goal

Major infrastructure projects will stymie the Albanese government’s ability to find the manpower to meet its flagship housing goal, according to a key federal body warning a major productivity overhaul is the only way to reach the target.

Australia faces the impossible task of finding an extra 90,000 tradespeople in the next three months, according to BuildSkills Australia, with the national housing accord’s target of 1.2 million new homes by 2029 further hampered by major state and national projects that include Defence building, the Western Sydney Airport and Melbourne’s suburban rail loop.

Second-year carpentry apprentice Marlee Morris says young tradies need help joining and staying in the industry.Credit: Louise Kennerley

Rob Sobyra, head of research at BuildSkills, launched by the government to address construction workforce woes, said the migration of skilled tradespeople needed to be streamlined and a productivity boost through greater investment in prefabricated homes could offset the labour shortfall.

He said Australia needed to increase the number of workers in residential construction nationwide from 590,000 to 680,000. This would raise the quarterly housing completion rate from about 43,000 homes to 60,000 to meet federal, state and territory governments’ goal under the accord, as part of a five-year plan that begins in July.

“Mid-2024’s just around the corner,” Sobyra said. “There’s no way we’re adding that many workers to the industry by then.

“So what that would mean is … this year’s 60,000 [homes] a quarter would have to be 100,000 next year in order to make up what we don’t deliver this year. So we will be chasing our tail to keep up to achieve the overall five-year objective.”

He said that modelling by BuildSkills suggested demands on the broader construction sector would produce a 40 per cent shortfall in labour by 2040.

Master Builders Australia chief executive Denita Wawn said the housing industry group had forecast that the industry needed to attract nearly 500,000 Australians over the next three to five years to replenish an ageing workforce and meet demand.

“Around 8 per cent of the workforce is likely to be lost to retirement and departures from the industry each year – equivalent to over 100,000 people per year,” Wawn said.

Federal Housing Minister Julie Collins said the government was working with states and territories to meet the ambitious accord target.

“We’re supporting states and territories to meet this target through the $3 billion New Homes Bonus, the $500 million Housing Support Program, the $10 billion Housing Australia Future Fund, and new incentives to boost the supply of rental housing,” Collins said.

The latest Jobs and Skills Australia vacancies data for people in construction trades shows that, as of February, there were 796 positions advertised in NSW, 729 in Victoria, and 868 in Queensland.

Skills and Training Minister Brendan O’Connor, who recently launched a review into attracting and keeping apprentices, said the government was “acutely aware of the constant need to ensure that our education and training sector is responding to the rapidly changing nature of our labour market, including the housing sector and prefabricated homes”.

“Getting the best outcomes for apprentices and trainees is vital to ensuring we have the skills our economy needs. We know that almost half of all apprentices don’t complete their training and that needs to be improved,” he said.

The housing accord, which includes the construction of 20,000 affordable homes on top of the 1.2 million, is central to the federal government’s plan to tackle the housing crisis, which crashed back onto the political stage last week after the Australian Bureau of Statistics revealed net overseas migration added 548,800 people to the population in the year to the end of September.

The federal opposition is linking the migration surge to the housing shortage, creating a tightrope walk for the government, which has also repeatedly acknowledged skilled migrants are needed to build more homes.

“It’s unbelievable that Labor can bring 765,900 migrants to Australia in a single year, yet there are still workforce shortages in the building industry,” Coalition immigration spokesman Dan Tehan said, referring to the number of overseas arrivals before departures were factored in.

“People are asking, where are these migrants going to live? They should also be asking, who is going to build all the houses? This is the problem with Labor’s Big Australia – it’s a complete mess.”

Sobyra said Australia needed to be more strategic about the migrants it attracted. “If they’re not migrants who can build stuff, if they’re not builders and engineers, then they kind of work against the objective.”

He said the proportion of migrants capable of working in construction needed to be higher than the amount of construction workers in the Australian population “because otherwise we’re ... chasing our own tail”.

Wawn said it would take time to grow Australia’s domestic workforce, and migration was needed in the short term to increase the sector’s capacity. She said tweaks to migration settings should include reducing application fees, better recognition of overseas trade qualifications, and lowering English language test requirements.

In December, Home Affairs Minister Clare O’Neil batted off calls from the Master Builders to include tradies in the top-earning stream of skilled migrants under Labor’s new strategy, which involves less red tape for employers to bring in highly skilled professionals.

However, Grattan Institute economic policy program director Brendan Coates said it shouldn’t exclude construction as there were site managers and engineers on building sites easily earning more than the $135,000 threshold for that visa category, and sponsorship costs were also prohibitive for employers.

BuildSkills says 60,000 homes will have to be completed every quarter from July to meet the goal of 1.2 million homes by 2029.Credit: Steven Siewert

“But, ultimately, if we want more housing we have to reconsider what else construction workers are doing right now,” Coates said. “In Victoria, the suburban rail loop is at the top of the list. If you want more construction workers, that’s probably the best place to get them.”

Sobyra said his figures did not account for the labour that would be diverted towards other major infrastructure projects, such as the rail loop, western Sydney’s new airport, and any works ahead of the Brisbane Olympics. He said while there wasn’t much worker movement between residential and other infrastructure, workers would be absorbed by second-tier developments that could include residential works as part of those builds.

“There’s certainly a lot of defence spending happening at the moment … all those ships, and all those submarines, and all those soldiers, they need new places to live where they’re going, and they bring their families with them, and they need their kids to go to school,” he said.

Sobyra also said one answer was greater devotion to prefabrication methods in residential construction, adding that the government could catalyse this by investing in prefabricated homes for its affordable housing goal.

“That’s where the productivity gains will be made, and that’s where we may be able to reach the goal without those extra 90,000 people, essentially,” he said.

Federal, state and territory building ministers agreed on Friday to cut red tape and enable further expansion and growth in Australia’s prefabricated and modular construction industry, with federal Industry Minister Ed Husic saying: “We need to build more quality homes quickly – prefab and modular housing gives us a chance to do that.”

A NSW government spokesperson said the state was examining how it could scale up the creation of modular homes. “This does not water down current legislation or regulations – the NSW Building Commission will ensure MMC [modern methods of construction] housing manufactured and delivered in NSW is of the highest standard,” the spokesperson said.

Comment was also sought from the Victorian government.

Second-year apprentice carpenter Marlee Morris said she was inspired to switch from another trade in residential construction because she wanted to see what houses looked like after they were being built.

“If you like working with your hands and being outside, you are predominantly outside in this role. You get to see the whole process from start to finish,” she said.

Morris said higher female participation in trades would encourage even more women to join them, and that there needed to be greater government input to make apprenticeships more achievable, particularly given the upfront costs for tools.

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