Q1 2024 Oceania Market Construction Update [Townsville]: The North Queensland market is stretched thin, with insufficient resources to adequately support projects in the region.
The rollout of significant state government projects in health, defence, and corrections in North Queensland is significantly impacting the overall construction market.
The entire industry—from labour and subcontractors to head contractors and consultants—is stretched thin, with insufficient resources to adequately support projects in the region. As a result, construction timeframes are increasing.
Labour costs are escalating above the rate of inflation. Although the rate of increase in construction costs is slowing, a considerable rise is still anticipated in 2024 and beyond.
In tender submissions, there are modest improvements in preliminary levels and slightly reduced profit margins. However, these remain significantly higher than pre-COVID levels.
Key factors impacting escalation
- Shortages of skilled labour, subcontractors, head contractors and consultants are reducing productivity, leading to project delays and increased timeframes
- Labour shortages are increasing labour costs at a pace that is currently outstripping inflation
Photo: RLB provided quantity surveying and advisory services on Engineering & Innovation Place, JCU Townsville, Bebegu Yumba Campus, a James Cook University education development. Photo credit: Andrew Rankin.
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