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  • Harley Dale
    Industry Expert

    Dr. Harley Dale is a career economist with 25 years experience spanning teaching, consultancy and banking

    Harley Dale
    Industry Expert

    Dr. Harley Dale is a career economist with 25 years experience spanning teaching, consultancy and banking

    Some of the guesswork can be taken out of making business decisions thanks to data.

    The Australian renovations and construction industry is made up predominantly of small businesses. Insights provided by various pieces of data-related information can be very helpful to guiding business decisions and showing where opportunities exist.

    There are numerous examples, but let’s just take four.

    A crane hangs over a construction site

    1. Population Data

     

    What it is:

    The Australian Bureau of Statistics (ABS) releases data regarding the nation’s population. The population data is available at abs.gov.au - its implications are considered by industry analysts, including Australian Construction Insights and can be used to look at how the nation’s population shifts in relation to broader economic trends.

    What it shows:

    Australia’s population dynamics are changing following the resources boom. The states with momentum to their population growth are now New South Wales and Victoria. That information suggests that in the next few years there may be increasing opportunity for commercial, new home building and renovations activity in those two eastern seaboard states.

    2. Infrastructure Investment

     

    What it is: 

    The NSW and other governments make announcements about infrastructure investment and this information is available on government websites. These can guide smaller construction operators as to where future skillsets may be required and where opportunities lie.

    What is shows: 

    Related to population growth, NSW is the state where infrastructure investment is currently receiving the most focus. Development of road and rail infrastructure over the next five to 10 years may well drive a range of development opportunities beyond the actual engineering construction projects, including tender opportunities related to future mixed use development sites, for example.

    3. Interest Rates

     

    What it is:

    Interest rates have an impact on all small businesses, but play a particularly important role in construction.

    They are essential information in terms of the forecast for borrowing costs, rather than just the here and now, for small construction operators and their current and potential clients. They give an indication of future demand.

    Overdraft rates, short and long term variable and fixed rates for small business, variable and fixed home loan rates all feed into the mix.

    What it shows: 

    The Reserve Bank of Australia’s recent decision to keep interest rates steady is one piece of data that is a significant influencer as to peoples’ decision to begin new construction or invest in the sector.

    Interest rates are already very low, and the message that they are set to stay there for a considerable time is good news.

    4. Labour Force Data

     

    What it is: 

    The ABS has recently released labour force data for June. The data shows which sectors of the economy are expecting employment growth versus contraction, and where in Australia employment markets are relatively strong or weak. It also provides insight into confidence and demand towards residential and commercial building projects and jobs.

    What it shows: 

    Labour force data is important. People’s feelings about their job security has a big influence on large spending decisions like building a new house or undertaking a major structural renovation, for example. Trends in unemployment rates provide insight into future demand for new commercial and residential development, along with renovation activity. As a rule, should unemployment increase, demand is likely to decrease.

    These data points are all examples of data that provide an insight into human behaviour and the opportunities that exist within Australia’s critical construction market. By understanding the predictions that these figures give operators, businesses can hire to take advantage, or find ways to streamline operations to weather the storm.

    That behaviour ultimately drives small business demand and opportunity, particularly in construction.

    What's next?

    1. Keep updated. Figures are being consistently updated on government websites including the ABS and the RBA. Check in every few months to see what can help you make business decisions
    2. Find what works. There are plenty of data sources out there and plenty of figures. Look through what’s available to see what you can use
    3. Stay on top of the news. Media regularly cover significant movements in figures that affect the construction sector
    4. Be adaptive. One of the perks of being a smaller operator is that it empowers you to make changes that open up opportunities. Subcontracting and further education are two options for taking advantage of changes in the sector
    Further streamline your construction business.

    Technology is changing the way construction businesses operate.

    Find Out MoreFurther streamline your construction business.

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