A recent HIA Trades Report has shown an easing in acute skilled shortages following its June Quarter 2023 release.

The report provides a quarterly review of the availability of skilled trades and any demand pressures on trades operating in the residential building industry which, according to HIA senior economist Tom Devitt, has revealed “continued improvement in the availability of skilled tradespeople across the country”.

“The Report’s Trades Availability Index registered -0.62 for the June Quarter 2023, compared to the -0.92 peak a year ago. An index of less than zero represents a shortage of tradespeople and an index of greater than zero represents a surplus,” he says.

“While the Index still reflects some of the most acute shortages of skilled tradespeople since HIA started this Report in 2003, the trajectory is most encouraging. Some of the greatest improvements in availability over the last year have been in the trades of carpentry, roofing, and bricklaying, precisely where the most acute shortages had been a year ago.”

With borders re-opening in late 2021, a number of sectors have seen a considerable difference in skills trade, including those in house and apartment construction and manufacturing businesses.

Tom says the price of trades has also slowed following an increased availability in tradespeople with a 3.4% rise in the last year compared to a 10% peak the year prior, with the result being “much closer to the 2% average annual increase that prevailed in the decade-and-a-half before the pandemic”.

“The outlook is that as home building activity declines, demand for skilled trades will slow further. The rise in the RBA’s cash rate over the last year has seen a significant drop in new work entering the pipeline. The record volume of projects awaiting commencement has shrunk, but there are still more than 100,000 houses under construction around the country,” he says.

He says that with the rise in interest rates that the industry has already seen, next year is expected to produce the weakest year of new house commencements since 2012.

He adds: “Next year will be the ideal time for governments to start investing in new public housing stock. The timing of this investment will not only ensure that governments are able to gain the greatest return on their investment, as costs and delays will be at a minimum, but also ensure that skilled tradespeople are not lost to other industries and that the industry can rebound on the other side of this RBA-induced trough.”