Construction II

Every time I've ever driven through Pontville someone tried to make a joke it was the spiritual home of Ricky Ponting. Right now, according to Sue Neales, it's the spiritual home of racism, oh and Lara Giddings is pretty awesome too - future press secretary arise! While Sue conveniently ignores her long term overarching employer whipping up this kind of sentiment for all it's worth, likewise, the peeps of Pontville overlook the coolness of the redo of their army barracks to house asylum seekers. $15 million for six months of use ain't bad, especially when another a Hobart construction company recently went into voluntary administration.

3 million owed, 150 creditors and 40 jobs potentially flushed. Scenport wasn't insignificant, it had commercial work at the Hobart airport and at UTAS, along with building some big arse homes - one of those back up for sale in Sandy Bay. 2.2 million and it's all yours.

Amidst this ongoing tale of construction doom and gloom, the usual suspects are saying the usual things, well kinda... There's the old spiel about red tape, which should be acknowledged - this ain't the time to start forcing builders to erect a site shed on every residential build, nor force builders to stick up scaffolding for any job over two metres. However things I'm not hearing anymore...

...there are increasing pressures on housing stock as underlying demand continues to exceed the supply of new residential dwellings.

As a state we are building at least 200 new dwellings less than what is required per annum.

What I'm hearing now...

We've had seven good years since 2003 where we have consistently built 3000 (houses) per annum.

But this year there is a marked softening in the industry and we predict that we will probably build 5 per cent fewer homes and probably wipe $50 million off the home renovation market compared to last year.

Where's that underlying demand and shortage gone? Things aren't looking good and despite another Commsec State of the States' face palm, suggesting residential construction starts were up 16% on decade averages, the HIA's Stuart Clues - like anyone with half a brain on the ground - suggested that idea was just plain weird.

Not to sound like a broken record, but greatest hits are greatest hits and you can put them back out on any compilation you like. So here's the TRET Immaculate Collection - since the early part of the noughties Tasmania got all Sim City with the house building: a new dwelling for every 1.62 people added to the population; the building industry went from 10,900 employees to over 20,000, taking it from 5.3% of the workforce to 8.6%. Now these aren't quite Irish bubble numbers, but maybe some journalist should quote them back to the Master Builders and HIA at some stage and ask the question, "Did Tasmania over cook this and are you ignoring that credit fueled growth is coming to an end?"
 
The assumption that this is a blip seems to be well ingrained, there's quite a bit of anchoring going on - as if because we've been there before we can get back there no worries. Giddings talks about a 'patchy recovery' like we're in a recovery and the HIA talks about losing construction employees like this...

The state's building industry employs 20,000 people and Mr Clues said the downturn put Tasmania's skills base at risk once residential construction lifted again.

"I've got no doubt that young tradies are contemplating reconstruction work in Queensland or heading over to Western Australia to make their fortune in the mines," he said.

"So when things gear up again here, work will stall - not because the jobs aren't there but because the labour isn't."

I guess it's up to me to start counting houses again and see what's sitting vacant and what won't need to be built when the false boom comes.

A final segue on skills shortages; the local branch of a worldwide business that is overly reliant on the mining boom - equipment - is currently desperate for workers. There's no problem with the skills availability, but it's the urine hitting the cup for the pre-employment test that ain't making the grade. Add to that, there's now a few weird signs around the shop floor. The corporate security boys are en-route. 

For christ sake, guys. At least pay off the Commodore before hitting the crack pipe. Last time the economy laid an egg, management slashed like a D-grade horror movie bogey-man. Don't think it won't happen again.