It is an unprecedented and disruptive time for the Australian construction industry as it faces severe labour shortages brought on by demographic shifts, an ageing workforce, strict immigration controls, budget constraints, a shortage of skilled tradespeople and limited vocational training opportunities. Funding has also become more difficult and expensive to obtain due to the tighter compliance requirements for projects.
Large building companies are entering voluntary administration on the back of evolving market demands, supply chain disruptions and soaring material and labour costs which are having a detrimental impact on the sector’s present state.
The flow on effect? Project timelines are being compromised, costs inflated, projects stalled or abandoned, and the overall quality of works delivered is being jeopardised.
What is being done to address the significant challenges in this sector?
It’s up to project managers to identify and implement innovative strategies and principles to reduce risks, identify cost-saving opportunities and streamline project delivery. How?
- By proactively identifying risks and issues around procurement
- Thoroughly auditing the financial viability of the required works
- Appointing consultants and head contractors not just on lowest price
- De-risking projects in the design development phase
- Implementing effective cost management strategies, including meticulous budget forecasting to ensure subcontractors working on projects get paid and projects are not being used to cashflow other projects
- Support the range of measures being discussed to boost skilled workers in the 2024-25 Budget
- Enforcing the key amendments issued by The National Construction Code (NCC) to align with evolving standards such as bushfire protection, structural integrity, accessibility, and waterproofing standards
- Adhere to the new energy efficiency requirements and robustly build this into the program of works, which may drastically impact the complexity of construction projects moving forward
Summary
Many of these strategies are being driven by emerging trends and technologies, with project managers proactively staying up to date with changes that are redefining traditional construction practices.
The storm impacting the construction industry isn’t over yet, but with the right client-side project manager on your team, your project is as protected as it could possibly be.
If you are interested in learning more about Empire’s project management services, we would love to have a chat.
