Engineering and commercial construction is expecting a big boost this financial year and next thanks to the booming resources sector, a new survey has found.
The total value of engineering construction work is forecast to expand by 10.3 per cent this year and rise again by 12 per cent in 2012/13, the Australian Industry Group/Australian Constructors Group Outlook survey said.
The expansion is expected to be driven by significant mining investment and industrial projects such as oil and gas processing.
While growth is expected in commercial construction, the survey does not anticipate that this will be as significant.
Construction in the commercial sector is forecast to increase by a modest 2.4 per cent in 2011/12 before expanding by 6.2 per cent in 2012/13.
As a result of this increased activity, total employment in the sector is expected to increase by 9.1 per cent this financial year.
However, skills shortages remains a significant issue for businesses.
More than two-thirds of the businesses surveyed have reported moderate or major difficulty in recruiting skilled labour. This is expected to rise to nearly 75 per cent in the next six months.
Australian Industry Group chief executive Heather Ridout said the increase in construction is on the back of the resources sector.
"The very strong outlook for engineering construction demonstrates that the historic surge in investment in mining and mining-related infrastructure is back in top gear," Mrs Ridout said in a statement.
However, she said the broader industry still faces challenges.
"Residential construction remains in the doldrums and while commercial construction shows welcome signs of life, prospects very much depend on the market segment and location."
The president of the Australian Constructors Association Peter Brecht said the prospects for the industry are positive.
"The survey underlines the solid growth prospects for Australia's non-residential construction industry on the back of strong resources investment and significant planned infrastructure work," Mr Brecht said in a statement.
Apartment construction is expected to go backwards in 2011/12 with a fall of 1.2 per cent before a 4.8 per cent expansion in 2012/13.
