Regional snapshots
reflect steady outlook
Master Builders’ latest Survey of Industry Conditions regional snapshots have revealed improved residential and commercial sector conditions despite another downward adjustment in business confidence.
Master Builders’ Deputy Executive Director, Paul Bidwell, said the regional snapshots showed a significant improvement in many of the key business benchmarks, including profitability and work levels, across nearly all regions of the state.
“Although the south east corner continues to lead the way, with the Sunshine Coast and Darling Downs & South West Queensland regions being the standout performers, even the struggling resource regions of Mackay & Whitsunday and Central Queensland had some good news to report,” Mr Bidwell said.
“The key constraints across most regions were once again the level of demand, planning approval processes, and the availability and cost of finance.
“An early trend we identified from the survey was an improvement in employment levels, with the majority of businesses expecting their staffing and apprentice levels to improve over the next three months.
“Across all regions there is also little evidence of upward pressure on prices as the industry continues to be driven by strong competition for available work and budget-conscious consumers. This is also expected to continue next quarter.
“Labour costs was highlighted as an area of concern in regions with a less flexible labour market, dominated by the resource sector. There are signs, however, that the labour market is already beginning to respond to the downturn, moving to the new growth areas such as the Sunshine Coast.
“Despite the challenges, respondents from across much of the state retain a positive outlook for the future,” Mr Bidwell commented further.
These latest results go hand in hand with the recent positive result for building approvals and housing finance and paint an optimistic picture for the building and construction industry in most regions across the state.
Brisbane
- Industry confidence dropped away slightly during the
June 2014 quarter but still remained at a high level
- Trading conditions for both residential and commercial
building continued to move forward over the quarter, with the commercial
sector joining the residential sector in positive territory for the first
time since the GFC
- Turnover and profitability improved
- Few businesses are reporting serious difficulties in
recruiting and retaining suitably qualified employees and subcontractors
- Lacklustre level of demand remained the most critical
constraint on business growth in Brisbane
- Planning approval processes and infrastructure charges
continue to act as significant constraints on business.
Gold Coast
- Industry confidence held steady during the June 2014
quarter
- Trading conditions for both residential and commercial
building held steady, and are expected to improve significantly over the
next quarter
- Turnover remained in positive territory for the fourth
consecutive quarter, while profitability returned to positive territory
for the first time since the GFC
- Employment levels held steady but still remain inside
negative territory
- Wage levels held steady with more than half of
businesses reporting no change
- The most critical constraint on business growth in the
June 2014 quarter was the lacklustre level of demand.
Sunshine Coast
- Industry confidence held steady during the June 2014
quarter, remaining at a high level
- Trading conditions for both residential and commercial
building continued to surge forward over the quarter, with both sectors
now recording three concessive quarters of improvement
- Turnover remained in positive territory for the third
consecutive quarter, with profitability also improving
- Employment levels were stable over the quarter, with
the majority of businesses (62%) indicating that they are now able to hold
their employment levels steady
- The lacklustre level of demand remained the most
critical constraint on business growth on the Sunshine Coast
- Where businesses are looking to expand and seek
additional finance, they are still coming up against the barrier of
finance availability and cost.
Burnett Wide Bay
- Industry confidence dropped away but still remained at
a high level
- Trading conditions for both residential and commercial
sectors improved over the June quarter
- Turnover and profitability surged forward and are both
well within positive territory
- Employment prospects improved, with the majority of
businesses (69%) now expecting to hold their current staffing levels
steady
- The level of demand remained the most critical
constraint on business growth in the region.
Darling Downs & South West Queensland
- Industry confidence dropped away slightly during the
June 2014 quarter but remained at a high level
- Trading conditions for both residential and commercial
sectors surged forward over the quarter
- Both turnover and profitability improved and are
expected to continue this trend into the September quarter
- Employment levels improved slightly over the June
quarter
- Wages levels strengthened, which is fuelling concerns
there will be a wages breakout
- Labour costs continued to be the most critical
constraint on business growth in Darling Downs & South West
Queensland.
Central Queensland
- Industry confidence dropped away over the quarter, but
managed to remain positive
- Trading conditions slumped in both the residential and
commercial sectors but are expected to improve over the next quarter
- Turnover and profitability improved, but still remain
in negative territory
- Employment levels remained soft with nearly a third of
respondents reporting weaker employment conditions
- The lacklustre level of demand was the most critical
constraint on business growth in Central Queensland.
Mackay & Whitsunday
- Industry confidence improved slightly during the June
2014 quarter, however it still remains in negative territory
- Conditions in the residential and commercial sectors
also improved, although both are still negative
- Even in the face of challenging business conditions,
both turnover and profitability improved over the June quarter
- Employment levels in the region fell away over the June
2014 quarter, with half of businesses now reporting that they expect to
reduce staff
- Wage growth pressure held steady over the quarter
- The low level of demand remained the most critical
constraint on business growth in the region.
North Queensland
- Industry confidence held steady during the June 2014
quarter, maintaining a positive outlook
- The commercial sector experienced a strong improvement
in trading conditions, however this was not matched in the residential
sector
- Both turnover and profitability improved over the
quarter
- Employment levels strengthened over the June quarter in
response to improved trading conditions
- Wage levels strengthened and businesses are not
reporting any difficulties in recruiting and retaining suitably qualified
employees and subcontractors
- The level of demand was the most critical constraint on
business growth in North Queensland.
Far North Queensland
- Industry confidence dropped away slightly during the
June 2014 quarter but maintained a positive outlook
- Trading conditions for both the residential and
commercial sectors experienced challenging conditions, but are optimistic
for the future
- Turnover and profitability, while improving, both
remained under pressure in the June quarter
- Both employment and apprenticeship levels in the
industry were fairly stable over the quarter
- Wage levels were steady across Far North Queensland and
should continue to remain so into the September quarter
- The lacklustre level of demand was the most critical
constraint on business growth in the region.
