More Challenges Ahead

Meeting Demand: Victoria’s Construction Industry Challenges

It continues to be a challenging year and with more law changes expected over the coming years working in the residential building industry continues to be difficult. But we also need to keep in mind that Victoria’s population continues to grow and ultimately these new Victorians need homes.

Our industry can provide these homes provided governments don’t impose unnecessary regulations that increase building costs and limit the supply of labour and land.

NCC Update

In recent weeks there has been some confusion about the commencement dates for the new version of the National Construction Code in Victoria. NCC 2022 does commence from 1 May 2023 with livable housing, energy efficiency and condensation management changes still scheduled to commence from 1 October 2023. While there is serious doubt about industry and consumer awareness of these changes it is unlikely that these dates will change.

Worker shortages

It is well known that a shortage of skilled workers is a major cause of delays to the completion of building projects. While the surge in home building activity in the last couple of years has contributed to this shortage there are longer-term structural problems that have caused this problem. The slowdown of home building activity later this year may improve the availability of skilled workers but there will be competing demands for these workers.

“The slowdown of home building activity later this year may improve the availability of skilled workers but there will be competing demands for these workers.”

Major infrastructure projects and other government projects are likely to take on many of these workers. Many older and more experienced workers have also decided to exit the industry recently. The stresses of responding to the COVID-19 pandemic and then the surge in building activity has worn many people out. Uncertainty about the amount of future work in the next couple of years and registration and licensing of trades is also not helping convince these workers to remain.

The Victorian government is trying to encourage more young people to join the building industry and this is a positive. It is important that governments provide support for employers looking to employ apprentices and trainees and remove unnecessary restrictions and taxes that discourage employment. Trade registration and licensing laws may also discourage young workers if these laws prevent them from setting up their own businesses and working for themselves in the future.

“It is important that governments provide support for employers looking to employ apprentices and trainees and remove unnecessary restrictions and taxes that discourage employment.”

Planning

The Victorian government has recently shown an interest in encouraging the building of more homes in established suburbs. This is consistent with a long-term policy of having 70% of new homes built in these suburbs. A number of proposals are being considered to encourage this to happen.

The housing industry can provide homes for consumers in the locations they want to live in. The government needs to remove excessive red tape for planning and building approvals. The industry can then build homes to meet consumer needs in the locations that they want to live.

“The government needs to remove excessive red tape for planning and building approvals. The industry can then build homes to meet consumer needs in the locations that they want to live.”

HIA members may contact our Technical Services, Workplace Services and Planning teams to get further advice about the above issues. Our website and regular emails for members will also have updates.