Statistics New Zealand data shows that building consent are at a 10 year high, even when there is still a shortage of housing. The construction sector is struggling to produce the skills needed to meet demand.
Building consents are at their highest in more than 10 years, but with the industry coming off such a low base, capacity is still a key issue.
Building consent data released today by Statistics New Zealand shows that to the end of October 24,789 new homes gained building consents this calendar year and 30,158 over the past 12 months. This is the highest number since 2004, but is still well below the high of 1973 when just fewer than 40,000 new homes were consented.
Building and Construction Industry Training Organisation (BCITO) Chief Executive Warwick Quinn predicts the 2016 year to end around 30,000 consents up on 2015. He says Canterbury and Auckland make up 53% of all consents issued which is slightly down on previous years. Auckland is expected to consent around 10,000 new homes up about 8% on 2015.
Quinn says 30,000 consents is 6.33 builds per 1,000 people and is approaching New Zealand’s long run historical rate of 6.58 builds per 1,000 people. This is double the rate of 3.12 builds per 1,000 people in 2011 when construction was at its lowest level of activity since records began.
While the turnaround is welcomed Quinn says 30,000 consents per annum needs to be the new norm and coming off such a low base the construction sector is struggling to produce the skills needed to meet demand. Quinn says the BCITO has a record number of apprentices in training and recently passed the 10,000 number for the first time, but more are needed.
“While 10,000 apprentices is a new milestone for us it is also our new normal and must be increased if we are to successfully fill the skills gap in construction” Quinn says.
“Most of our growth comes from those firms that traditionally have apprentices so we want to increase the number of employers who train. In order to do that we need to have training programmes that align more closely with their business needs and how the industry in general is structured,” he says.
BCITO has been working closely with the Tertiary Education Commission and the New Zealand Qualifications Authority to explore how this might be done and a pilot will be launched in the New Year to test demand and options. Quinn says the competition to attract people into the trades is high so broadening the opportunities and being flexible in our approach to producing the skills the market needs will hopefully entice more into the industry. Quinn says there has never been a better time to get into construction with a strong forward work projection and great job security.