Australia’s plan to build 1.2 million homes by 2029 is facing another major obstacle, with the construction industry estimated to be short more than 116,000 skilled workers.
BuildSkills Australia estimates the sector needs an additional 116,700 tradespeople and construction workers to meet expected demand, increasing concerns that housing supply will continue falling short even as property prices retreat.
The shortage covers occupations including carpenters, electricians, plumbers and other skilled trades required to move developments from approval through to completion.
Construction costs and lengthy project timelines have already made new housing significantly more expensive.
Apprenticeship pipeline struggles
Industry groups argue Australia needs to improve apprenticeship completion rates while making construction careers more attractive to young workers.
Master Builders Australia has proposed measures including apprenticeship wage rebates, expanded group training programs and faster recognition of existing skills.
Migration could fill part of the gap, but industry leaders say overseas workers alone will not solve the longer-term shortage.
The workforce constraint comes as governments attempt to dramatically lift housing construction under the National Housing Accord.
At the same time, buyers are becoming increasingly cautious about purchasing new properties following builder collapses, construction delays and rapidly rising costs.
Only around 23% of first-home buyers are considering newly built properties, directing more demand towards the existing housing stock.
Rental vacancy rates also remain tight at around 1.8%.
The situation illustrates why falling house prices alone may not resolve Australia’s affordability problem.
Without a substantial increase in the number of homes being completed, lower prices could eventually collide with another period of undersupply once borrowing conditions improve.
