Eighty-seven per cent of respondents noticed a rise in stress or mental health issues in their business over the past 12 months. Photo / NZME
Eighty-seven per cent of respondents noticed a rise in stress or mental health issues in their business over the past 12 months. Photo / NZME
A new survey has highlighted significant problems in the building sector, including rising mental health issues, but also signs of optimism.
The annual State of the Sector survey, commissioned by Registered Master Builders, explored both the supply and demand sides of construction and revealed that, while the sector continued to face significant challenges, there were encouraging signs of underlying resilience in the sector.
More than 1200 sector participants and homeowners, who had built or completed a significant renovation in the past three years, responded to questions about their experience building, the economy, critical issues they were facing, and their outlook for the sector.
A key result from the survey revealed that while 79 per cent of sector participants thought the economy would deteriorate over the next 12 months, only 31 per cent of builders believed their own businesses would be worse off.
Master Builders chief executive David Kelly said this was a sign of underlying resilience in the sector, with many having strong order books and consent numbers remaining high.
"There is still demand across the sector, especially so in the commercial construction sector, where the pipeline remains incredibly strong," he said.
This sentiment was shared by homeowners in the survey, with nearly half (45 per cent) stating they would recommend building to others in the present environment.
The survey also revealed the sector was still confronted with ongoing challenges.
Cost escalation (96 per cent), supply chain disruption in concert with product availability and increasing product substitution (95 per cent), and skill shortages (67 per cent) were identified as the three most critical challenges facing the sector, all an increased proportion on the year prior.
Constructive NZ Construction Forum in Rotorua this week. Photo / Carmen Hall
"Additional costs and project delays are the consequence of the pressures facing the sector, and in turn these are causing a rise in the number of customer complaints and disputes," Kelly said.
"Finding skilled staff also has appeared in the top five issues every year since we began Constructive seven years ago. What is reassuring is that apprentice numbers are increasing, and more of those surveyed are taking on new apprentices than ever before."
Almost 60 per cent of respondents said it was harder to get the staff they needed than it was 12 months ago. This built on last year's results, where 66 per cent of respondents were already finding it harder to get the staff they needed than in 2020.
Of those looking to bring skilled labour into the country, only 7 per cent said the present settings were allowing them to bring in the labour they needed. Thirty-one per cent were bringing people in, but with difficulty, and 62 per cent were not able to bring in the skilled people they needed.
The immigration settings were seen as being too complex, cumbersome, and time-consuming to navigate.
Consenting continues to also be a significant issue for the sector, with 80 per cent of respondents reportedly affected by consenting delays, and was consistent with last year.
"Consenting is an area where some quick wins could save the sector considerable time and costs – both sector participants and homeowners are reporting the cost increases and disruption caused by unresponsive consenting processes.
"While we are pleased to see this is on the Government's reform agenda, we need to ensure we develop some fast improvements to help the system now, while the full review takes place."
The survey also highlighted the impact these issues continued to have on the sectors' mental wellbeing.
Eighty-seven per cent of respondents noticed a rise in stress or mental health issues in their business over the last 12 months.
"This was on top of an already stressed sector, as seen in last year's result, in which 88 per cent of people said that stress and mental wellbeing was an issue in their business," Kelly said.
"We must improve the mental wellbeing of the sector to keep delivering the homes and infrastructure that New Zealand needs.
"The market may be turning, but we shouldn't talk ourselves into a deeper downturn. Let's not underestimate the sector's resilience."
Kelly said this was different to the previous downturn, after the global financial crisis, when all work just stopped.
"This time we still have strong order books, especially across renovation and commercial construction. And the Government is committed to a large civic building programme.
"Finally, it is important to remember, if you are in a position to do so – now is still a good time to build. It is also unlikely to get cheaper to build in the future."
