New Zealand Construction Industry
The construction sector generates more than $30 billion in revenues annually and employs around 170,000 people in a wide variety of occupations. The quality of infrastructure – be it
transport, telecommunications or electricity networks, water storage and reticulation, schools, hospitals and recreation facilities – is critical to productivity and economic growth.
However, long-standing challenges exist in the sector, including the weather tightness issue, the sector’s relatively poor productivity performance and its highly cyclical nature. With the endless cycle of peaks and troughs, whenever you get those highs and lows there is inefficiency.
The greatest challenge is the unprecedented workload that will be
placed on the industry in the next few years, driven the demand in Auckland for housing and infrastructure investment, and the weather-tightness remedial work. We can help manage the cyclical nature of the business both over its capacity to meet the demand during the peak, and the risk to the viability of firms once the peak has passed. A smooth work programme.
New Zealand Construction Sectors
Residential and non-residential building together employ 44,000
workers, close to half of whom are self-employed.
Construction services is a large and diverse sub-sector, employing some 96,000 workers, 37% of whom are self-employed. Included are many occupations such as electricians, plumbers, concreters, carpet layers, plasterers, joiners who are sub-contracted to both small and large building projects.
Heavy and civil engineering firms specialise in large infrastructure
projects such as roads, dams, tunnels, and telecommunications
and electricity networks. The sub-sector has 35 large firms and account for 72% of employment, or 20,000 workers.
Each sector is challenged with the cyclical nature of the business. If you’ve got highs you are screaming round finding labour and the labour costs go up and you’ve got a lot of retraining costs. If you are in a low you are shedding labour and there’s the cost of redundancies.
Heavy and civil engineering firms specialize in large infrastructure projects and is attracting sub-contractors to start an infrastructure side to their business, or a joint venture with others, so they have the option to credibly bid infrastructure work. Contractors have been forced to change and adapt and we can help naviagate through these challenges.
How we can help you
We can help you understand the risks involved and how to manage them by:
Developing a sustainable business to manage peaks/troughs
Undertaking scenario planning to identify levers
Managing your assets and monitoring performance
Managing and mitigating project risk