Construction Industry in Australia

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Name
Professor
Institution
Course
Date
Construction Industry in Australia

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Table of Contents
1.0 Introduction 3
2.0 Market share ...............................................................................................4
2.1 market sectors in the construction Industry 6
3.0 Factors That Influence Demand For Construction Products(demand side factors) 8
3.1 Government Policies 9
3.2 Economic Conditions.....................................................................,,............9
3.3 Inflation................................................................................,......,..........9
4.0 Supply Side Factors.........................................................................................9
4.1 Urbanization..............................................................................................9
4.2 Grants.....................................................................................................9
5.0 Product Elasticity In Construction Industry.........................................................10
6.0 Aging workforce and shortages of skills affects the construction Industry.....................11
6.1 Impacts of the aging population.....................................................................12
7.0 Conclusion................................................................................................13

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1. INTRODUCTION
Construction industry in Australia is one of the primary drivers of Australia’s budget. The
industry is Australia’s third contributor after mining and Finance. It generates approximately 8%
of the GDP in its value added terms. The industry is made up of more than 330,000 businesses
around the whole country and has employed more than one million people which is roughly 9%
of the total labor force (Myers, 2016, p. 45). The business is involved in the production of
erections and infrastructure that are indispensable to the setup of all other industries. The
industry also supplements the capital stock of the country and reinforces the developments that
are vital to support the country’s affluence and incomes.
In the financial year 2014/2015, the direct construction output amounted to 7.8% of the
Australia’s total output which was an improvement from 6.6% ten years ago. The latter is what
made the construction industry Australia’s third largest contributor of the country’s GDP as far
as the volume of output is concerned. Only the financial and mining sectors contributed more
than that. The construction industry also supports supply chains both downstream and up stream.
The building industry is the third largest commissioning business in Australia having
recorded 1.05 million employees as of 2015.Most of these workers are employees in the trade
sector. Employment in this industry has been associated with the solid recovery that took place in
2013 and the growth that extended across 2014. The biggest level of building segment is the
building installation services followed by the building completion services and then the other
constructions services follow suit.

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1. Market Structure
As discussed earlier, the construction industry in Australia accounts for 7% of the overall
GDP. The products of the building company are made up of three unique sectors; the engineering
building, non-domestic building and the domestic building. The three are not closely related and
each has its own distinctive features. The unpredictability of the industry is also not similarly
disseminated amongst the three. Research that was done by the Australian bureau of statistics
showed that the building industry is made up of small partnerships with twenty workforces in
average who contributes to the industry’s output (Construction - Australia Market Research
Report, 2019, p. 28). The table below shows the commercial supremacy of the small firms in the
construction. Businesses that had employment of less than 5 accounted for at least 93% of all
industries in the business and had two thirds of all workers in the industry.
(Construction
- Australia Market Research Report, 2019, p. 34).
The businesses that had less than five accounted for almost half of the overall revenue
while those with occupation of more than twenty accounted for one third of these stuffs. After