Addressing construction challenges in Australia
Throughout 2015, the construction industry saw a series of ups and downs, creating a mixed bag of both challenges and opportunities.
With a number of high-performance pockets still apparent within the industry, how can construction professionals best take advantage of these opportunities?
Industry performance slows for the end of the year
The most recent Performance of Construction Index (PCI) highlighted the overall contraction of the industry in December.
According to the Ai Group and Housing Industry Association, a decrease in activity across all sectors was mildly concerning for the start of 2016, especially as the index indicated a slowing pipeline of approvals. This deceleration led to a rating of 46.8, a 3.9 point drop from the previous month. Any rating below 50 indicates a period of contraction in terms of growth.
However, December did have some positive notes, with the apartment approvals and residential construction sub-sectors managing to expand in the final month of 2015. Chief Economist of Master Builders Peter Jones stated that, despite the off-peak number of approvals, the outlook for construction jobs in residential projects is looking positive.
"Despite a dip in the latest building approvals, residential builders can be confident with a strong pipeline of work for 2016," he stated.
Major company to sell Australian portfolio section
Although the industry hit a slow point in the previous month, there are still opportunities for individual companies to expand and grow within the country.
Many businesses have put forward expressions of interest to buy the Australian arm of Laing O'Rourke.
Global engineering enterprise Laing O'Rourke is looking to shrink its portfolio in Australia in favour of breaking into niche markets within the United Kingdom and Europe.
While the company is yet to confirm any sales, Group Chairman and CEO Ray O'Rourke stated that many other businesses have put forward expressions of interest to buy the Australian arm. Mr O'Rourke explained that the potential sale of any Australian businesses is a matter of internal strategy, stating that units within the country have been "very successful" so far. During the sales period, the company will continue to serve clients and customers as normal until a deal is finalised.
If ambitious companies take over the business operations, this could provide a vital boost to the pipeline of projects for the country, providing a better outlook for the industry in the long-term.