8 July 2014 — BRIEF: Gains in the housing sector helped lift the national construction sector into growth territory for the first time this year, according to the latest Australian Industry Group/Housing Industry Association Australian Performance of Construction Index.

The seasonally adjusted index lifted 5.1 points to 51.8 in June (readings above 50 indicate expansion).

In addition to house building growth – up 2.2 points to 56.6 – engineering construction jumped 16.3 points to 51.1 with a pipeline of infrastructure work on the east coast getting underway.

However, growth was offset by falls in apartment building (49.2) and commercial construction (49.8).

“The Australian construction sector closed off the financial year on a positive note by lifting back into growth following five slow months,” Australian Industry group director – public policy Peter Burn said.

“The housing sub-sector went from strength to strength marking a tenth straight month of expansion with an accelerated pace of increase in June.

“The stars aligned for engineering construction with an unexpected lift in activity on the back of local government and infrastructure projects.”

Housing Industry Association economist Diwa Hopkins said that while the pipeline of infrastructure work on the east coast was boosting conditions in engineering construction, commercial construction remained weak area within the broader industry, and whether it would improve over the coming financial year was yet to be seen

Key findings for June:

  • The Australian PCI grew in June for the first time this year – up 5.1 points to 51.8 to be above the 50 point expansion level.
  • Construction activity grew 6.1 points to 53.1 in June.
  • House building registered 56.6, apartments 49.2, commercial construction 49.8, while engineering construction was 51.1
  • Construction employment remained weak at 47.4
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