Media Release

13 October 2009

After being hit hard by the global economic downturn the country’s construction industry can look forward to improved performance and expansion in 2010, says Department of Labour Head of Labour Market Information Monique Dawson.

“Key to ensuring the industry’s long term development will be the availability of skilled staff, with the retention of apprentices, in particular, being vital”, she says.

Ms Dawson was commenting on Construction Sector Outlook, a report from the Department of Labour that charts the growth of the industry since the turn of the century and how it has responded to the downturn over the last two years.

“The Construction Sector Outlook report investigates the relationships between construction industry activity and indicators that have historically lead its growth. The analysis shows that a recovery in residential construction activity can be expected to commence before the end of the year, while employment may fall slightly further before stabilising. The extent and speed of the impending recovery will depend on consumer and business confidence.”

Ms Dawson says although Gross Domestic Product figures for the June quarter showed the downturn may be bottoming out, it is likely to be a few months before that result is reflected in construction activity and an upturn in employment.

“As the report shows, the worldwide recession has meant construction activity levels have dropped, and jobs have been shed. Employment in construction has fallen by 5% since peaking at 190,000 in June 2007. Paid hours of work in construction fell by 12% between March 2008 and June 2009, indicating that some staff are working reduced hours.”

“The report identifies the loss of skilled workers and a reduction of apprenticeships during this recession. It is essential that the construction industry takes a strategic approach to workforce development issues, ensuring as many apprentices are kept in work as possible to ensure it can take full advantage of the opportunities created by an economic upturn”.

The Construction Sector Outlook reportwas produced by the Department of Labour, in consultation with the Department of Building and Housing and the Building and Construction Industrial Training Organisation. It can be found at http://www.dol.govt.nz/publications/lmr/construction-sector/summary.asp

ENDS