Media Release
14 January 2010
NATIONAL SURVEY OF BUILDING AND CONSTRUCTION
STIMULUS CUSHIONING THE DOWNTURN
Statement by Peter Jones, Chief Economist
Builders’
own activity and expectations for industry activity both fell back in the December
quarter but Government stimulus spending continues to cushion the downturn, according to
the results of Master Builders Australia’s National Survey of Building and Construction.
Master Builders Australia Chief Economist, Peter Jones, said: “Despite twin challenges of
reduced credit availability and weaker economic conditions, the Government’s stimulus
spending and low interest rates are preventing a collapse in construction activity.”
Mr Jones said, “Thanks to the Government’s well-targeted stimulus measures, the building
and construction industry has stabilised after threatening to nose-dive early in 2009.”
“What remains to be seen is whether the rebound in building confidence from the depths of
pessimism experienced at the height of the global financial crisis actually translates into
improved business conditions.”
He said, “Despite a pick up in operating conditions and greater optimism about the outlook,
the industry still faces major stumbling blocks and the likelihood of a volatile period ahead.”
“Although pockets of the building and construction industry are doing well, particularly those
exposed to government stimulus spending, most other sectors are ‘doing it tough’.”
“To ensure the building and construction industry continues to help insulate
the economy
from the effects of the global financial crisis it is crucial
that fiscal and monetary policy
settings encourage productive investment and job creation.”
“Spending on the schools program and social housing initiative are helping to offset industry
weakness, particularly in non-residential building and construction.”
“Residential builders remain positive about the outlook, with key forward indicators providing
some encouragement, although the ending of the first home owners boost scheme and
sluggish investor activity mean that it will be some time before a fully-fledged recovery
becomes evident.”
“Australia needs a strong phase of house building to prevent strong demand simply
translating into higher prices.”
“A strong supply response will be thwarted and housing affordability will once again become
a front page story unless
all levels of government urgently rethink land availability and
developer charges policies.”
For further information, contact:
Peter Jones, Chief Economist, Mobile 0403 440 838
NEWS 
