According to new economic modelling, commissioned by Master Builders Australia, a $13.2 billion investment from the government could fuel over $30 billion in new economic activity and create 105,500 new jobs.
Denita Wawn, CEO of Master Builders, said the construction industry has been severely impacted by the coronavirus crisis and needs an urgent cash injection to kick-start the recovery process.
“Building and construction is shaping up to be one of the industries worst hit in the long term by the COVID-19 economic crisis,” Ms Wawn said.
“We know from previous downturns that it takes four times longer for our industry to recover than the rest of the economy.”
She explained that since the economic crisis is not a result of a market failure, but the outcome of the lockdown imposed by the government, the government needs to support builders by ensuring they return to work.
“We are asking our political leaders to show the same courage and vision in supporting our industry as they showed in responding to the health emergency,” she said.
Ms Wawn cautioned that work for builders and tradies in 2020–21 is fast evaporating and the indications are that 2021–22 will not be much better.
“There is no time to spare in meeting this threat to the viability of nearly 400,000 building business and the jobs of 1.2 million people employed in our industry.”
Master Builders is also asking for a dedicated building and construction industry taskforce established to oversee the implementation of the stimulus action plan.
She said: “For stimulus to occur, building activity needs to commence.
“Builders and tradies cannot sustain their businesses and jobs on promises.
“We have seen that governments can fast-track construction activity in response to natural disasters and COVID-19 is shaping up as an economic disaster.”
Master Builders also claims a government boost would lead to $17.6 billion in construction activity across housing, renovations and commercial construction.
Master Builders commissioned EY to model a stimulus package comprised of three programs with a total value of just over $13 billion.
The package includes:
A $40,000 uncapped new home building grant.
- $17 billion in additional economic activity resulting from $5.2 billion investment by government.
- The creation of 58,311 jobs right across the economy almost replenishing the 77,580 jobs lost in construction since the start of COVID-19.
- Delivering 14,000 extra new homes.
A resilience renovation program, including funding for renovations to make homes resilient to natural disasters or more accessible.
- $7 billion in economic activity for $4 billion investment by government.
- Creating 24,036 jobs.
A commercial program, which includes funding for cladding/asbestos rectification, a 10 per cent drop in developer charges, 5 per cent increase in government spending in health, defence and education.
- $6.8 billion in economic activity for $4 billion investment by government. This excludes wider economic benefits in relation to health, safety and building quality.
- Creating 23,118 jobs.