Welcome to the winter edition of On the Job.
The Federal Election 2019 has come and gone, and as winter descends, we wait to see which of the election promises materialise. The triumphant Coalition spruiked a few policies that could bolster the building and construction industry, including a new $500 million, First Home Loan Deposit Scheme for first time homebuyers, which could see an uptick in building activity.
There will be no changes to current tax incentives for investors, such as negative gearing and CGT discounts, which means property investors are likely to remain prominent in the market.
Workers will get some new protections, with dodgy employers facing criminal punishments for the exploitation of workers. There will also be a national registry scheme for shifty labour hire firms.
Income tax cuts are also on the cards, with those earning between $48,000 and $90,000 receiving tax refunds of up to $1,080 for singles, and up to $2,160 for dual-income households. For those who own a small business turning over less than $50 million, ScoMo has promised to cut taxes to 27.5 per cent, with a view of reducing this further to 25 per cent. And if you are getting close to hanging up the tool-belt, there are a few incentives in play to boost your super.
It is a case of wait and see when it comes to the Federal Budget, and when the policies announced will actually come into effect – such as the $100 billion in infrastructure projects (predominantly benefiting Victoria and Queensland) and the $525 million investment in apprenticeships and vocational training.
In this edition:
- Hot Works
- Slips and Wet Weather
- Public & Products Liability
- Floating Cities
We hope you enjoy this edition of On the Job.
The BuildCover and TradePlusCover Team
Welding, soldering, grinding – at some point, practically
every tradie will be involved in some kind of ‘hot work’.
But inadequate control of hot works can be the
cause of out-of-control fires or explosions.
Slippery when wet
Gliding around on a slick of water might be great
fun when you’re ice-skating, but it’s a real hazard
on the job.
When things go pear-shaped - or why
tradies need public liability insurance
Accidents happen, but without Public Liability
insurance, tradies could be exposed to crippling
hits to the back pocket.
Future Forecast: Floating cities
Forget packing up the ute or loading the work van,
if the United Nations’ plan for creating new cities
comes into play, it may not be long before you’ll
need a boat to get to the jobsite.
EBM News & Events
Tom Teom a finalist for a prestigious award.
News in Brief
- Dwelling approvals decline.
Figures from the ABS revealed the number of dwelling approvals fell by 0.6 per cent in March (trend terms), driven by a decline of 1.4 per cent for private sector attached houses, although private dwellings excluding houses rose 0.8 per cent. The trend estimate for the value of new residential building approvals rose 0.3 per cent, while the trend estimate for the value of alterations and additions to residential building rose 1.2 per cent. In contrast, the trend estimate for the value of non-residential building approved fell 0.6 per cent.
- Fewer new homes being built.
HIA’s quarterly economic and industry outlook revealed the number of new homes being built fell 15.2 per cent in Q1-2019 and noted that a further 11 per cent decline in activity is expected through the calendar year.
- New home sales up.
According to the HIA’s New Home Sales report for March, new home sales stabilised in the quarter. NSW (4.8 per cent), SA (8.6 per cent) and WA (2.3 per cent) all experienced an increase in new home sales compared to the previous month, while Queensland experienced a decrease of 4.7 per cent and Victoria was down by 2.9 per cent.
- Lending for housing declines.
ABS figures showed the total value of lending for households and businesses fell by an overall 2.6 per cent in March (seasonally adjusted). The value of investment dwelling lending dipped 2.7 per cent, while the value of owner-occupier loans fell 3.4 per cent.
- Construction worker pay stagnates.
Although the ABS’s Wage Price Index rose 0.5 per cent over the first three months of the year, workers in the construction industry have fallen behind. Across the country, the average annual pay rise was 2.3 per cent, but those in construction only saw an average 1.8 per cent increase in their pay packets. Figures showed the sector shed 50,000 jobs over the 12 months to February as residential building dived.
- Instant asset write-off increased.
The instant asset write-off threshold has increased to $30,000 per item for assets purchased/first used/installed after 2 April 2019 and prior to 1 July 2020. In addition, eligibility for the scheme has been extended to mid-size businesses (those with a turnover less than $50M). Speak to EBM Finance about funding options for your asset and equipment purchases.
- New NCC in force.
On 1 May 2019, the new National Construction Code, overseen by the Australian Building Codes Board, came into effect. The NCC provides the minimum necessary requirements for safety and health, amenity, accessibility and sustainability in the design, construction, performance and liveability of new buildings.
- Construction prices to climb.
According to a report by consultants, Rider Levett Bucknall, construction prices will rise faster than previously expected as Australia's infrastructure boom drives demand for services such as excavation, formwork and concreting. Tender prices will rise faster this year than last in every city except Canberra and Melbourne – where growth will be unchanged at 3.5 per cent and 4 per cent respectively – and in Sydney, where price growth will slow to 4.4 per cent from 4.9 per cent.
- Construction activity weakens.
According to the AI Group’s Performance of Construction Index (PCI), activity levels continue to weaken while margin pressures are intensifying. The PCI slumped to 42.6 in seasonally adjusted terms, down 3.0 points on the level reported in March. The report noted staffing levels were cut at the fastest pace in nearly six years, while new orders continued to dry up: “Despite growth in engineering construction, overall levels of activity in April were adversely affected by continued declines in housing activity, commercial construction and apartment building work.”
- Top earning trades.
Tradies from 10 occupation groups earn more than the average Aussie salary ($1,320 per week according to ABS data): mechanical engineer trades workers (aircraft maintenance engineers, metal fitters and machinists, precision metal trades workers or toolmakers and engineering pattern-makers) are the top earners at $2,266 per week, followed by electricians ($2,216 per week), plumbers ($1,947 per week), bricklayers, carpenters and joiners ($1,741 per week), electronics and telecommunications trade workers ($1,703 per week), glaziers, plasterers and tilers ($1,687 per week), fabrication engineering trades workers ($1,645 per week), automotive electricians and mechanics ($1,576 per week), floor finishers and painting trades workers ($1,566 per week), panel-beaters and vehicle body builders, trimmers and painters ($1,368 per week).
- Late payments continue.
A report by the Australian Small Business and Family Enterprise Ombudsman has found one in two SMEs have more than 40 per cent of their invoices paid late. It was revealed that large businesses that offer 30-day payment terms to their smaller business partners rarely pay on time. Concerningly, 28 per cent of SMEs reported over 60 per cent of their invoices were paid late in FY18. Builders/tradies operating b2b should speak to their EBM Account Manager about Credit Insurance.
- Tradie boss boost in WA State Budget.
From 1 July, business owners in WA who hire an apprentice or trainee could be eligible for a payment of up to $8,500 per worker. The State payment will be higher for employers in regional areas and those who take on people under 30, those with disabilities and indigenous workers.
- Apprenticeship boost in Federal Budget.
Federal Budget 2019-20 contained a $525 million skills package to go towards 80,000 new apprenticeships. If adopted, incentive payments to employers will be doubled to $8,000 per placement while apprentices themselves will receive a $2,000 payment. The extra apprenticeships will be targeted at industries considered vulnerable to shortages over the next five years, including carpenters, plumbers, hairdressers, bricklayers, plasterers, bakers and tilers.
- Team gears up for Tradie Olympics.
Australia’s 15-strong contingent of young tradies – the Skillaroos – are preparing for the 45th WorldSkills International Championship taking place in Kazan, Russia in August. The Skillaroos, all aged between 19 and 22, will compete against 1,600 of the best apprentices and trainees from the 60 WorldSkills member countries in the hope of becoming World Champions in their chosen trade or skill area.
- Oz capitals most expensive for construction.
According to design and consultancy firm Arcadis’ International Constructions Costs Report 2019, four of Australia’s capital cities are ranked amongst the top 100 most expensive for construction. Sydney ranked 34th, Brisbane 56th, Melbourne 61st and Perth 62nd. New York City topped the list.
- Electricians most trusted tradies.
Results from the hipages Tradie Trust Index found that both consumers and tradies rate electricians as the most trustworthy trade. It also found that the more money consumers hand over to tradies, the more wary they are – with more than 70 per cent of consumers less trusting of tradies when the jobs are worth over $2,500. Around the country, regional consumers are more trusting of tradies, with 57 per cent compared to 54 per cent in suburban areas and 50 per cent in metro locations. Gen X (55 per cent) are the least trusting generation, whereas Baby Boomers (60 per cent) trust tradies the most. Women (57 per cent) are also more likely to trust tradies than men (48 per cent).
- Upcoming building and trade shows:
- 5-7 July, MBA Home & Building Improvement Show, Adelaide
- 12-14 July, Queensland Garden Expo, Nambour
- 18-21 July, Australian International Furniture Fair, Melbourne
- 18-21 July, Decoration + Design, Melbourne
- 19-21 July, Property Buyer Expo, Melbourne
- 20-21 July, Sydney Property Expo
- 24-26 July, Security Exhibition & Conference, Sydney
- 9-11 August, The Home Show, Perth
- 10-11 August, SPASA Spa & Pool Show, Melbourne
- 10-11 August, Backyard & Garden Show, Melbourne
- 16-18 August, Skills West Careers Expo, Perth
- 16-18 August, The Home Show, Melbourne
- 23-25 August, Melbourne Timber, Tools & Artisan Show
- 28-29 August, Australian Smart Lighting Summit, Melbourne
- 10-11 September, Safety In Action, Brisbane & Melbourne
- 11-14 September, International No-Dig Down Under, Melbourne
- 14-16 September, HIA Brisbane Home Show
- 17-18 September, Woodtech, Melbourne
Lighter side - Hi-vis is the new black
Traditionally, the sartorial choices of Aussie tradies have been a tad questionable – jockeys on full display (or failing dismally), puffer jackets with stubbie shorts, socks as ear muffs tucked under the beanie… but it seems that’s all changing.
High fashion is taking to hi-vis (neon in fashion-speak). Just take look at the latest collection from New York’s Jeremy Scott (think fluro yellow, green and orange) or the gobsmacking Spring/Summer 2019 Emporio Armani ensemble that worked back an acid lime green, high-shine suit with bright blue work boots.
Other tradie staples moving from worksite to catwalk include:
- sturdy lace-up boots with gripped rubber soles (Prada, Vetements)
- utility style – oversized pockets, extra zips and belts (Louis Vuitton, Chanel, Proenza Schouler)
- cargo pants (Prabal Gurung, Isabel Marant) and boiler suits (Celine, Giambattista Valli)
- “belt bag” goes all tool-belt (thanks Fendi, with a $2k+ price tag to boot)
So next time a dubious ensemble gets some odd looks, adopt a haughty demeanour and simply say, “It’s Lacroix, sweetie!”
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