Not enough contractors
A SEVERE shortage of qualified contractors is the single
greatest barrier to new construction projects, according to a
survey by KPMG.
The survey says that demand for construction is expected to
increase significantly over the next five years.
"The problem looks set to intensify as the pool of qualified
contractors able to bid for projects is reduced and the wider
shortage of skilled labour affects the ability of teams to
deliver projects on time and to budget," the Global Construction
Survey 2007 says.
KPMG partner Steve Gatt said in the 2005 survey of contractors
they believed clients were transferring inequitable amounts of
risk to the contractors.
"That is now changing. Highly regarded contractors will be in a
powerful position when negotiating contracts and will be able to
transfer more risk back to the procurer.
"Australian contractors work globally and enjoy an increasing
high profile in India, China and the Middle East, countries
which appear to be gripped by development and infrastructure
renewal fever," he said.
Mr Gatt said the survey showed that the demand for Australian
contractors at home and offshore was growing and they were
increasingly able to be more selective as to which projects they
take and the terms, conditions and margins they negotiate.
But while the increased demand and shortage of labour is good
news, the cloud of another rate rises hangs over the sector,
according to the latest Master Builders Australia National
Survey of Building and Construction.
"Building activity appears set to improve although the outlook
remains clouded whilst there is continued speculation about
another rate hike," the Master Builders' survey says.
MBA chief economist Peter Jones said the March quarter survey
revealed builders becoming positive about the outlook for
residential activity and conditions in non-residential were
expected to remain strong.