Skilled trades remain in high demand in all regions

June 2021 Qaurter

The HIA Trades Report provides a quarterly review of the availability of trades and the demand pressures on those trades. Specifically, the report considers the supply conditions with respect to individual skilled trade categories across Australia and within particular states, as well as the corresponding price changes.

A record year for detached home building has kept skilled trades in very high demand in the June 2021 quarter. The number of detached commencements surged following the announcement of HomeBuilder in June 2020 with the March quarter 2021 reaching the strongest quarterly result since records began in 1969. This has occurred across all jurisdictions and is more than 40 per cent higher than the same time last year when the supply of skilled trades was close to equilibrium.

The HIA Trades Availability Index improved marginally from -0.55 to - 0.53 in the June 2021 quarter. The Index records the availability of skilled trades across all states and territories and this result indicates a significant shortage of skilled trades.

This small improvement reflects quarterly volatility, not a material improvement in the supply of trades. This shortage remains one of the most significant in the past 20 years.

While the index shows that all trades are in short supply, bricklaying has the most acute shortage with an index reading of - 1.07. This is down from -0.53 in the June 2020 quarter. Roofing and Carpentry follow closely behind with index readings of -0.87 and -0.86 respectively.

Electricians have the smallest shortage with an index reading of - 0.11, this is a deterioration from a positive reading of 0.20 in the June 2020 quarter.

Likewise, all the regions measured in the HIA Trades Availability Index had a shortage of skilled trades in the June 2021 quarter. Most regions reported only minor fluctuations compared to the March 2021 quarter.

Regional Queensland had the most severe shortage at -0.94, closely followed by Perth with an index reading of -0.91. This is a significant deterioration, particularly for Perth, compared to the June 2020 quarter when these areas had index levels of -0.10 and +0.64 respectively.

The price of skilled trades in the June 2021 quarter increased by 1.8 per cent compared to the previous quarter to be 2.6 per cent higher than the June 2020 quarter. All trades recorded a price increase over the year to June 2021 with the exception of joinery and painting which recorded modest declines. Painting is typically used at the end of the new home construction process and may not yet have experienced the boom in demand from HomeBuilder. Joinery on the other hand may be more affected by the shortage of timber and other building materials. Demand for joinery will likely be subdued until these material constraints ease.

Roofing, site preparation and bricklaying had the largest increase in price over the year to June 2021, rising by 7.9 per cent, 7.2 per cent and 7.0 per cent respectively. Roofing is in particularly high demand in Queensland due to the storm that hit the state at the end of 2020.

Other finishing trades are expected to experience price increases in the coming months as the surge of homes being built reach the final stages of construction.