The industry's performance corresponds with the slump of private investment into building in the aftermath of the global financial crisis.
Melbourne, Australia (PRWEB) March 30, 2014
From offices and factories, to hotels, airport terminals and retail complexes, the Commercial and Industrial Building Construction industry constructs most of the buildings where Australians work, shop and play. The industry's revenue is forecast to total $29.6 billion in 2013-14, up 0.7% on the previous year but remaining well below the record peak of 2007-08. According to IBISWorld industry analyst Anthony Kelly, “confidence in the commercial property market has struggled to recover due to the fragile global economy and sluggish local consumption and investment trends.”
Over the five years through 2013-14, industry revenue is projected to decline at an annualised 4.3%. Profit margins have also been squeezed. “The industry's performance corresponds with the slump of private investment into commercial and industrial buildings in the aftermath of the global financial crisis and weak investor confidence,” says Kelly. However, some contractors have derived stimulus from growth in the aligned institutional building market (notably primary schools refurbishment) and the reconstruction of flood-damaged buildings in Queensland.
The industry's prospects are forecast to strengthen over the next five years, with stronger conditions on local property markets due to rising property yields and occupancy rates. Industry revenue is forecast to be primarily driven by a resurgence in the value of commercial building construction (notably hotels and office developments) and, to a lesser extent, increased industrial building activity. Direct employment is relatively low because the industry relies heavily on a subcontracted labour force. Industry employment is estimated at 40,000 people in 2013-14, while the total workforce numbers about 155,000 people when including direct employees, apprentices, working proprietors, consultant engineers, consultant architects, surveyors and subcontracted labour. The Commercial and Industrial Building Construction industry has a low concentration of ownership, with the four largest firms accounting for less than 20.0% of annual revenue. Relatively few companies are capable of constructing large-scale or complex landmark projects.
For more information, visit IBISWorld’s Commercial and Industrial Building Construction report in Australia industry page.
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IBISWorld industry Report Key Topics
Operators in this industry construct commercial and industrial non-residential buildings. They also perform alterations, renovations and general repairs of commercial and industrial buildings, and organise and manage construction.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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