June 13, 2017 / News
The construction industry has continued to flourish and has expanded for the fourth month in a row in Australia. This has been mainly due to the growth in apartment and infrastructure work across the country.
The Ai Group's Performance of Construction Index (PCI), has been recently released for the month of May. It is a monthly report that provides 'real-time performance indices' on Australia's construction industry, and its various sub-sectors, such as houses, apartments, commercial and engineering. It helps to uncover trends and gauge the health of the industry.
A score above 50 indicates that the sector is experiencing expansion. While a score below 50 signals that the sector is contracting. The distance of the score from 50 expresses the speed at which that particular sector is expanding or contracting.
According to the Ai Group's Performance of Construction Index (PCI) for May 2017, apartment building activities were the most outstanding driver of growth in Australia's construction industry. The apartments sub-sector increased by a whopping 13.2 points from last month to 68.5 points. This is a positive indicator that the boom in high-density residences is not ver yet, with multi-unit structures continuing to be approved.
The second strongest contributor to the construction industry's continued growth is engineering. Engineering increased by 4.3 points from last month to 59.9 points. This is the highest level of growth that engineering construction has experienced in 9.5 years. The significance of the engineering sub-sector to the construction industry has been spurred by the boost in governmental infrastructure funding, and the various large-scale infrastructure projects that have been deployed as a result of this. Major public infrastructure projects, such as developments and improvements to Australia's road and railway systems, are the main types of projects driving the expansion of this sector.
However, it's not all good news for the construction industry. The housing sector scored 45.6 points, which is a decrease of 7.4 points from the previous month. This signals that house building activities are experiencing a decline and that the boom is starting to 'cool off'. Despite the slowed growth in housing development, the significant increase in apartment and infrastructure activities are more than enough to offset it and lead to overall growth for Australia's construction industry.
It appears that Australia's construction industry continues to enjoy fruitful times, particularly for the apartment and infrastructure sectors.
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