The civil construction industry is eagerly awaiting ‘record spending’ on three waters, public transport and road safety improvements to bring financial certainty and stability so it can work towards overcoming New Zealand’s infrastructure deficit.
Results from the 2019 Construction Industry Survey, a joint research project commissioned by Civil Contractors New Zealand (CCNZ) and Teletrac Navman, reveal uncertainty in the pipeline of new projects is severely impacting the civil construction workforce. To complete projects that the government has promised ‘record spending’ on, the civil construction workforce is anticipated to need tens of thousands of new workers in the coming years.
- Over three quarters (77 per cent) of respondents thought the most positive impact on the industry over the next three years would be the development of a clearer pipeline of central and local government work.
- Close to one-third (27 per cent) of contractors will be looking to increase their capability in three waters projects (freshwater, stormwater and wastewater), followed by roading and residential (both 18 per cent) and public transport (15 per cent).
- Respondents indicated fewer new staff will be needed in the next 12 months than in the previous two years.
- In 2017, only two percent thought their staff would decrease and 19 percent said that they would hire eleven or more staff members on the spot.
- In 2019, 12 percent anticipated a staff decrease and only four percent would hire 11 plus staff.
- Despite this, 50 per cent plan to recruit add to their workforce.
“A clearer, more reliable flow of work and projects brings certainty to both businesses and people in the industry, enabling them to undertake the important work needed in updating and improving New Zealand’s infrastructure. If contractors are unable to see when proposed projects will come to market, this prevents them from investing in their businesses,” CCNZ Chief Executive Peter Silcock said.
“The survey shows contractors are already looking to diversify in the project types they can deliver in anticipation of significant public projects entering the market. A clearer work programme will enable them to better plan their diversification and make the best investment in people, skills, equipment and technology.”
“The report suggests the industry understands the need to invest in the workforce, but many businesses are being impacted by lowest price procurement and just don’t have the margins built into their contracts to do so. It is very clear that we need the support of the industry’s largest clients – local and central government – if we are going to invest in our people. That sort of support is vital and will be warmly welcomed by the industry,” Mr Silcock said.
Contractors welcomed the government’s increased emphasis on training and development of people and other social outcomes through the Construction Accord and new procurement rules. Over two-thirds (64 percent) of respondents thought an emphasis on training would have a positive impact over the next three years. The results indicate that a large proportion of training is delivered on-the-job in the civil construction industry, however only 61 percent felt they had the current resources to train people.
“Training is absolutely crucial in the infrastructure sector. These businesses work on large-scale, multi-million-dollar projects that are vital to our standard of living, things like: water, transportation, communication and energy that impact on our everyday lives and public safety,” said James French, Construction Industry Specialist at Teletrac Navman, provider of GPS-based fleet and asset management technology.
“A number of gaps in off-job training were highlighted by survey respondents in everything from training in safe chemical handling to specialist drilling equipment. However, the most needed off-job training was in operating specialist equipment and machinery. Training needs will likely increase as new technology changes the way machinery and equipment operates, and the types of projects undertaken. A good example is light rail,” Mr French said.
“Investments in the workforce will have a long-term positive impact on the industry, but it needs commitment from all corners of the industry: clients, suppliers, contractors, subcontractors, and individual staff,” he said.
The 2019 Construction Industry Survey was discussed by an expert panel at the CCNZ annual conference in Rotorua on Friday 2 August. The survey garnered responses from business leaders and managers within the construction industry and gauged attitudes on a wide range of issues including current events, staff and skills, and construction technology.
A report on the findings of the 2019 Construction Industry Survey is available on request, or for CCNZ members to download from the members’ section of the CCNZ website at www.civilcontractors.co.nz/login.