The Australian Industry Group's (AI Group) Australian Performance of Construction Index has found that the industry's rate of contraction has remained broadly unchanged at  34.8 (readings below 50 indicate a contraction in activity with the distance from 50 indicative of the strength of the decrease).

 

Published in conjunction with the Housing Industry Association, the Index found poor demand and falling workloads impacted heavily on activity. The residential and commercial construction sub-sectors remained deeply in negative territory in the month, with apartment building recording its steepest fall in ten months to 21.8. Engineering construction remains the strongest sector despite falling by 1.4 points to 39.9 in June.

 

"The residential and commercial construction sub-sectors continue to be a drag on overall business activity with lack of demand and access to finance both holding these important sub-sectors back. Engineering construction is stronger particularly due to mining-related projects but the overall construction sector continues to languish," AI Group's Director of Public Policy, Peter Burn, said.

 

Key findings in the Index include:

  • The national construction industry remained in the red in June according to the latest Australian Industry Group Australian Performance of Construction Index (Australian PCI®), in conjunction with the Housing Industry Association which was relatively unchanged, up just 0.1 points to 34.8 (readings below 50 indicate a contraction in activity with the distance from 50 indicative of the strength of the decrease).
  • The Australian PCI® has now been in contracting for 25 straight months.
  • Construction activity was 28.9 which is the lowest level since February 2009.
  • Apartment building was the weakest performing sub-sector at 21.8. House building was 30.7, commercial construction was 26.6 and engineering construction was 39.9.
  • The new orders sub-index registered 33.4 in June largely due to reduced work in house building and apartment building.
  • Wages (55.7) and input prices (73.7) were higher

 

The full Index can be found here