One of the most important issues facing the construction industry is the safety of the workers. Although most of the operators in the industry are ethical and professional, corruption can affect the public image of the industry. This industry has also been slow to adopt new technologies. A good example is the rise of the Australian dollar. The cost of raw materials has increased. A strong Australian dollar has affected the price of metals and other materials. In addition, interest rates have increased dramatically.
Another issue that is hampering the construction industry is the shortage of skilled labor. With a shortage of skilled workers and a low-profit margin, many construction firms are turning to financial planners to plan their businesses and ensure they remain profitable. The industry has also been hit by organized crime and corruption. The Royal Commission is currently investigating the industry’s practices and misconduct and weekly media reports have been appearing on malpractice.
As a result, underbidding is a major cause of insolvency in the industry. While it is common in the construction industry, many contractors fail to account for their true costs. They often seek to recover their losses through contractual claims, subcontractor payment disputes, and phoenixing. Such bad practices lead to the rapid decline of the construction industry. This situation affects everyone, from contractors to the public.
Another issue affecting the construction industry in Australia is insolvency. According to data from the Australian Securities and Investment Commission, no other industry sector is affected as severely as the construction industry. Insolvency affects around eight to 10 percent of the national gross domestic product and accounts for 23% of the total external administrations. There were 2,153 corporate insolvency events in the construction industry in 2013-14, according to ASIC data.
A stable Australian dollar and stabilizing supply chains will keep construction costs at a moderate level. However, these factors will depend on the sector that you are in. In general, however, the construction industry in Australia is experiencing more inflation than the rest of the world. This trend will only continue. While it is good news for the Australian economy, there are also some challenges that could impact the construction industry. There are some construction regulations in place in NSW and Victoria, which could further reduce the industry’s growth.
COVID-19 is a growing concern for the construction industry in Australia. The new regulations require stricter hygiene and safety practices. Furthermore, the expertise of construction workers is of paramount importance. Unqualified workers can make costly mistakes and create bad impressions with clients. They can also lead to delays and frustration in the project. Therefore, the construction industry needs to embrace innovation and find solutions to improve its efficiency. Further, social distancing has affected the productivity of job sites and supply chain management.
A new infrastructure investment boom is also underway in Australia. The Australian government has announced 15 major infrastructure projects worth AUD72 billion by 2020. These projects are expected to support more than 60,000 jobs. If all of these projects are completed, they will create an environment that encourages construction and innovation. A strong economy will require skilled workers.