Australia does not have enough construction workers and other tradies to meet election pitches to boost housing supply, experts say, casting doubt over the major parties’ pledges to address housing affordability.
Anthony Albanese and Peter Dutton announced their competing housing plans this week, with both major parties seeking to increase the number of new home builds above the current annual rate of about 170,000.
The Labor government nominated a target of 250,000 completed homes a year for the next four years, while the Coalition was yet to commit to a target.
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But Labor’s goal cannot be reached given the low number of skilled tradespeople in the construction workforce, according to Tim Reardon, the chief economist at the Housing Industry Association.
“We don’t have enough people,” he said.
“We can build 200,000 to 220,000 with the labour force we have at the moment, [but] getting to 250,000 is the point at which we need more skilled labour.”
The association estimated there were close to 280,000 workers in key skilled occupations but a shortage of 80,000 tradespeople remained. Industry bodies have consistently called for greater government support to increase the workforce.
Reardon said tradespeople were turning to other careers, school leavers were shunning building and skilled migrants were entering the workforce too slowly.
The number of construction trades apprentices in training fell 3.7% in the year to September, a report from the National Centre for Vocational Education Research found.
There were 10,000 fewer new starters annually compared to 2021, while a greater number of trainees were withdrawing from their courses.
“The building industry still has an acute shortage of labour because we’re losing labour to the mining industry and other construction projects,” Reardon said.
Almost a tenth (9.5%) of Australia’s workforce have their main job in the construction industry, but the median weekly earnings for construction workers are $1,598 – about $100 less than the median weekly earnings across all industries, according to the government.
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Both parties had committed to increase subsidies and financial incentives for apprentices but neither program would be enough to close the skill shortage, according to Michael Fotheringham, the managing director at the Australian Housing and Urban Research Institute.
“We haven’t seen enough from either party on it,” he said. “A modest workforce strategy from Labor and no workforce strategy from the Liberals are not going to get us there.”
The Labor party committed to building 100,000 homes reserved for first home buyers, working with state governments and industry, while the Coalition would also allow first home buyers to tax deduct their mortgage payments if they buy a new build.
Both parties on Sunday said they would expand the first home buyer guarantee scheme.
The cost of building materials has fallen but experts and builders said new builds remained limited due to slow approvals processes, high building company failures and limits on the arrivals of migrants with construction skills.
Dutton had committed to reducing migration overall but on Monday committed to increasing the number of tradespeople entering the country, without providing details or figures.
“We’ll have more tradies coming in under our scheme,” he said.
A specialist streamlined visa for skills in demand, open to a limited set of occupations, excludes construction tradespeople.
That exclusion means construction companies face months-long delays to get workers to Australia on skills visas, which has been discouraging employers, according to Sonia Le-Heggart, migration strategist at Absolute Immigration.
Whereas immigration applications by nurses move through the system quickly, tradespeople are slow to get in, Le-Heggart said.
“I’ve had so many complaints where employers have been like, ‘I’ve invested all this money and applications are taking so long to bring a worker, and I need the guy to come and work because I don’t have enough workers, and I can’t meet demand,’” she said.
“They’re just not able to get that overseas workforce.”
