Harding: I think it will take until 2025 for the industry to stabilise.

While key construction material prices have stabilised following the pricing surge experienced late last year, high demand continues and it is unlikely that any easing in pricing will be passed downstream to domestic supply chains, at least in the short term. Paterson: We anticipate continued volatility for the next 12-18 months – inflationary pressures and interest rates will need to stabilise before the market normalises. At the end of the day, what do we have? Sub-par work being produced, non-fit for purpose products being chosen to begin with to keep costs down, and everyone going along for the ride because they need the work.ĪFR: When do you expect insolvencies to stabilise? What’s even more worrying is the effect this is having on quality of work and safety.

Gill: I believe construction insolvencies will start slowing down towards the end of 2023 and into 2024.īartolini: I anticipate the unfortunate trend of insolvencies persisting and potentially worsening. Pacific Formwork director Grace Ferreira: “Unlike with residential building, where there’s a bit of flexibility in the contract, we’re in it for better or for worse. But in the 10-year average, it’s still below average. Hansen: We would expect to stabilise and gradually improve as those projects priced prior to the large cost inflation are completed.īourne: We are very concerned that there will be further insolvencies in the supply chain.įlecker: We expect insolvencies to worsen in the short term before starting to improve.įerreira: They probably will get worse until September.

Harding: I expect we will continue to see a high level of insolvency in the industry for another 18 months or so.

Respondents included Lendlease managing director, construction David Paterson, Multiplex CEO John Flecker, Hutchinson Builders chairman Scott Hutchinson, ADCO chief executive Neil Harding, Hansen Yuncken co-chairman Richard Hansen, Roberts Co CEO Matt Bourne, Built CEO Brett Mason, Mirvac CEO development Stuart Penklis, building contractor Urban Core managing director Dominique Gill, subcontractor Pacific Formwork director Grace Ferreira, subcontractor Rock Up Group CEO Dani Bartolini, Ai Group CEO Innes Willox and Australian Constructors Association CEO Jon Davies.ĪFR: Do you expect insolvencies in construction to worsen or get better from here? Here is an edited transcript of their insights. The Australian Financial Review reached out to leaders in the construction sector to gauge the state of the industry.

I Can Tell the Time by Gill Davies