Construction survey: 59% lack forward work beyond a year

Construction sector confidence is lacking. Photo / Greg Bowker

A new survey has found 59% of construction businesses don’t have more than a year’s forward workloads.

Accountants and business adviser BDO got a survey firm to quiz 196 construction businesses in April and May and found them under pressure.

“Forward work remains a concern for construction business leaders,” said the BDO New Zealand construction sector report.

“Just 41% of survey respondents have sufficient confirmed work beyond 12 months, a slight decline from 2024, and more than a quarter only have enough work to cover the next six months or less.”

That means 59% lack orders a year out.

Economic pressures were the biggest concern for construction business leaders.

Those in Auckland and the rest of the North Island are the least positive, experiencing challenges on profit margins and forward work orders.

Construction sector leaders in Auckland are not as optimistic as those in the South Island. Photo / Auckland Transport

Mainlanders are more optimistic.

South Island leaders report the strongest levels of positivity regarding their overall business performance at 71%, which BDO attributes to house building in Christchurch and Queenstown.

“This compares to 66% of Wellington/Wairarapa respondents feeling positive about their business performance, 53% in Auckland and 52% in the rest of the North Island.”

After two years of challenging economic and market conditions, some parts of the sector have recovered more quickly while others are still near the bottom of the trough.

But staffing levels seem to have stabilised, with business leaders no longer facing the severe labour shortages that were a feature of the industry in previous years.

Most respondents (57%) say that current staff levels meet their needs, while just under a third expect to be actively looking for staff in the next 12 months.

When asked what their greatest challenges or concerns are for the next year, many survey respondents mentioned staffing issues of some kind, including finding skilled senior workers, retaining staff and keeping morale high.

BDO said 45% of respondents worked at businesses with more than 30 employees and 62% had an average annual turnover of $5 million+ in the past three years.

The survey was conducted by an independent research agency.

Stats NZ has noted the construction downturn too.

In the year to March, non-residential building consents totalled $8.9 billion, down 7.2% annually.

Building types with the highest values were:

• Offices, administration and public transport buildings: $1.7b, up 2.6%;
• Storage buildings: $1.4b, down 6.4%;
• Factories: $1.2b, down 4.1%.

Last month, Hawkins, owned by ASX-listed Downer EDI, was named as New Zealand’s busiest commercial builder based on the $1.2b of work it won last year.

Data specialists BCI Central released a list of the 50 most-active builders nationally, following a 2024 list out last June and a 2023 inaugural list.

The top 50 builders started 868 projects last year worth $8.6b and were rising to meet adversity with determination and expertise, BCI found.

Naylor Love was the second busiest and LT McGuinnes was third on the BCI list.

Anne Gibson has been the Herald‘s property editor for 25 years, written books and covered property extensively here and overseas.