Australia’s forecast construction outlook for the commercial sector, post-COVID is difficult to predict with Victoria still in lockdown and the availability of a vaccine, to be advised. The construction sector directly and indirectly employs around 1.6 million people in Australia.

The current uncertainty in our economic environment, which includes the unknown impact of reductions in the Jobkeeper allowance from October 1st and subsequent cessation of this allowance from March 2021, makes projections difficult. However, Master Builders predicts that the commercial sector construction activity could drop from $44.5 billion in 2019-20 to around $38 billion per annum and hold at this level for the next three years, through to 2022-23.

This projected drop of around 15% is largely driven by a decline in private sector-led projects due to the prevailing economic uncertainty. The sectors expected to be most significantly impacted include tourism, recreation and entertainment. However, government stimulus is expected to boost public sector funding in areas of health and education. This will mitigate some of the downturn in private-sector led projects, but won’t outweigh it, with a net effect of a flat 3-year period to 2022-23, before the economy is expected to recover to its long-term course from 2023-24.