2022 Wrapped
A look back on the year that was
2022 has been a long and eventful year for Australia, who’s property industry has been caught in a perfect storm amid supply chain shortages and skilled labour reductions.
The relationship between Australia and its exports has been intrinsically reshaped by the pandemic, which brought several years of lockdown, isolation, and a notable change between Australia and its largest two-way trading partner: China. Australia’s biggest exportation industry in 2022 was iron ore mining, of which the construction industry is one of the biggest downstream markets. Fluctuations in the property market has influenced the demand globally for materials such as steel, bolstering the demand for iron ore, which has thus worked in Australia’s favour.
One in four small-medium enterprises (SMEs) have admitted that supply chain issues are significantly impacting their businesses. Approximately half of these have become more likely to increase their use of Australian-manufactured materials and goods.
Australia has benefited from the impacts of globalisation on the global supply chain but has long been reliant on the efficiencies of other nations. The pandemic, married with the situation in Ukraine, has brought to light the underlying issues that this reliance has created, hence encouraging us to look more inward and begin manufacturing on home soil.
An exciting opportunity has been plagued with labour shortages, with the construction industry one of the hardest hits, exacerbated by the immense reduction in Australian migrant numbers over the last three years. The labour shortage has hampered the execution of hundreds of projects nation-wide, while engineering and technical toles have remained in high demand. It is expected that automation will embed its relevance in filling the gaps created by this shortfall in the years to come.
As a result, Australia’s construction costs continue to rise at record-breaking rates. Subsequently, project developments have been slowed, becoming more expensive to complete due to the rising costs of materials, transportation, and logistics. The ongoing presence of Covid-19 can also not be ignored, contributing to the continued economic pressure on builders.
These factors combined have caused rental prices to increase across the nation – the biggest annual jump on record. Considering this, 2022 has been the year of balance between affordable housing options, and private housing, which has attempted to create a wider range of housing opportunities for hardworking Australians.
This year, above all else, has encouraged us all to be adaptable. While the trends that have influenced the industry have brought with them many downsides, it has been encouraging for the sector to be supported by numerous government schemes and funds, which have supported the construction industry, enabling it to bounce back from the pandemic reasonably well. We must harness this ability to be adaptable in the years to come and continue to learn from past mistakes to be ready, and agile, in the face of uncertainty in the future.
