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8731.0 - Building Approvals, Australia, Mar 2004  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 05/05/2004   
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Feature Article: Engineering Construction


This article was published in Building Approvals, Australia (cat. no. 8731.0), March 2004

INTRODUCTION

The building and upgrading of the nation's infrastructure, such as our roads, railways and telecommunications, contribute significantly to Australia's economic growth. The ABS measures the value of this engineering construction in the quarterly Engineering Construction Survey (ECS), which has been conducted since 1986.


The purpose of this article is to provide an overview of engineering construction in Australia and compare it with other sectors of the construction industry, to highlight its significant growth and its contribution to the economy. It is important to note that growth in a certain state or territory, or for a particular commodity may often be related to a small number of large projects.

AN ENGINEERING CONSTRUCTION BOOM?

Engineering construction makes a substantial contribution to overall building and construction activity. While recent attention has largely focussed on the residential building sector, there has also been increasing activity in the engineering sector.

Figure 1: Value of work done, Volume terms
Graph: Value of work done compared to building types



Figure 1 shows the growth experienced in engineering construction over the last few years. Since 2000-01, engineering construction has increased by 30.3%, compared with the 44.6% increase experienced by new residential buildings.


The value of engineering construction has been higher than the value for non-residential buildings since 1991-92. In 2002-03, the total value of engineering construction work done in Australia was $24,078m compared to $14,600m for non-residential buildings.

PRIVATE OR PUBLIC

The total value of engineering work done has grown steadily over the last ten years, with most of this growth being in the private sector. Public sector activity has remained relatively constant.

Figure 2: Value of work done, Volume terms
Graph: Value of work done for the public and private sectors



Figure 2 shows the value of work done for the public sector has traditionally been higher than the value of work done for the private sector. However, in 2002-03 the private sector value was marginally higher than the public sector.


Care should be taken when comparing work done in the private and public sectors as some of the changes are the result of the privatisation of selected industries.

WHAT ARE WE CONSTRUCTING?

The total value of engineering construction work done in Australia over the past fifteen years has been largely dominated by 'roads, highways and subdivisions', as shown in Figure 3. Other major contributors have been 'telecommunications', 'heavy industry', and 'electricity generation transmission, distribution and pipelines'.

Figure 3: Type of engineering construction, % of total work done (a)
Graph: Type of engineering construction - Australia



STATES AND TERRITORIES

The level of engineering construction at the state or territory level paints an interesting picture. Residential building activity is predominantly driven by population size or growth in a particular state or territory. Engineering construction is driven by many factors in addition to population changes, including the physical size of the state and the quantity of mineral resources.

Figure 4: ENGINEERING CONSTRUCTION BY STATE, % of Australian work done
Graph: Engineering construction by state



Figure 4 indicates that the four major contributors to the value of work done over the last fifteen years have been New South Wales, Queensland, Victoria and Western Australia, respectively. Queensland has shown a steady increase in its proportion of the total value of work done in Australia.

Table 1: Average Annual Value of Work Done, 1998-99 to 2002-03

NSW
Vic.
Qld
SA
WA
Tas.
NT
ACT
Aust.
$m
$m
$m
$m
$m
$m
$m
$m
$m

Roads, highways and subdivisions
2,001
1,059
1,342
370
761
96
73
62
5,762
Bridges, railways and harbours
583
167
382
39
214
16
128
1
1,530
Electricity generation, transmission etc. and pipelines
884
841
843
278
311
108
21
25
3,311
Water storage and supply, sewerage and drainage
511
229
371
105
220
26
26
20
1,507
Telecommunications
1,326
774
728
201
298
54
44
67
3,491
Heavy industry
385
281
956
252
1,268
5
365
1
3,513
Recreation and other
326
276
323
109
164
17
14
42
1,271
Total
6,017
3,626
4,945
1,355
3,235
320
670
218
20,385


Table 1 shows that the highest values of work done were in New South Wales, Queensland and Victoria for five out of the seven commodities listed. One exception is 'heavy industry', which was dominated by Western Australia ($1,268m), followed closely by Queensland ($956m). Half of the states recorded their highest average value of work done on 'roads, highways and subdivisions', while Western Australia and Northern Territory were dominated by 'heavy industry'.


More data, including data based on a more detailed list of commodities at the national level, can be found in the publication, Engineering Construction Activity, Australia (cat. no. 8762.0), or on the ABS website at http://www.abs.gov.au.


If you would like more information about engineering construction data, contact Melanie Wilson on 08 8237 7382.


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