Construction

For this industry, analysis is provided on the Northern Territory’s (NT) construction activity for residential and non-residential buildings, engineering construction activity, building approvals, as well as construction work yet to be done, detailing both private and public sector estimates.

Economic contribution | Contribution to employment | Engineering construction | Non‑residential construction | Residential construction | Explanatory notes

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Historically, the NT’s construction industry has been heavily influenced by resource-related projects. The strong economic expansion from 2011 to 2018, primarily driven by the Ichthys liquefied natural gas (LNG) project, prompted a surge in engineering construction that peaked at record levels in 2015. Residential and non-residential construction activity also experienced an increase in activity, albeit at lower levels of growth. Following the completion of the Ichthys LNG project, construction activity across all components has significantly declined.

Economic contribution

• The NT’s construction industry decreased by 46.6% in 2018-19 to $1.6 billion, contributing a 5.3 percentage point loss to the total 1.5% economic loss (Chart 1).
• The construction sector in the NT accounts for 6.3% of the total gross state product (GSP) in 2018-19, down from 11.4% in the previous year. This now represents the lowest share of GSP across all jurisdictions (Chart 2).
• In comparison, the value of the national construction industry decreased by 3.4% in 2018‑19, accounting for 7.5% of national gross domestic product (GDP) in the same year.

Contribution to employment

• In 2019-20 the NT construction industry contributed 8.2% or 10,806 people to the total resident workforce, which is the fourth largest employing industry in the NT (Chart 3).
• Employment declined by 2.9% in year on year terms, driven by a decrease in building and engineering activity.
• Nationally, the construction industry made up 9.2% of total national employment, accounting for 1,179,066 people over the same period.

Engineering construction

Engineering construction includes mining, oil and gas, and other heavy industry and utility‑related developments, as well as infrastructure including roads, highways, railways and bridges

Work done

In the year to March 2020:

• the value of engineering construction work done fell 59.3% to $1.1 billion, which is a return to 2011-12 pre-INPEX levels (Chart 4).
• the yearly decline reflects falls in private sector work done (down 65.8% to $822 million) and public sector work done (down 6.2% to 264 million).
• the decline in public sector work done was mainly due to bridges, railways and harbours, while the decrease in private sector work done reflects declining demand for heavy industry.

Work commenced

In the year March 2020:

• engineering work commenced fell 21.1% to $706 million.
• private sector work commenced fell 36.1% to $407 million, mainly due to a 78.5% decline in electricity generation, transmission and pipelines work.
• public sector work commenced increased 16.4% to $298 million, largely due to a 213.9% increase in bridges, railways and harbours (contributing 21.4 percentage points).
• For the latest data and analysis on engineering construction activity in the NT, see the Department of Treasury and Finance’s Engineering construction activity economic brief.

Non‑residential construction

Non‑residential building includes hotels and other non‑residential accommodation facilities, shopping centres, factories, offices, warehouses, schools, medical centres, correctional facilities and other similar buildings.

Work done

In the year to March 2020

• the value of non‑residential building construction work done fell 23.4% to $433 million (Chart 5).
• the yearly fall reflects a 3.0% decline in private work done to $217 million, and a 36.8% decline in public work done to $216 million.
• For the latest data and analysis on non-residential construction activity in the NT, see the Department of Treasury and Finance’s Building activity economic brief.

Building approvals

Building approvals can be used as a leading indicator to determine the trend of construction-related activity, which measures the number and value of building work approved for non-residential buildings.

In the year to May 2020:

• the value of approvals related to non-residential buildings fell by 36.1% to $323 million, which reflects a 48.2% decrease in the value of public building approvals to $146 million and a 20.8% decrease in the value of private building approvals to $177 million (Chart 6).
• the decrease in value of approvals for both the public sector and private sector are mainly related to ‘other non-residential’ building facilities.
• For the latest data and analysis on non-residential building approvals in the NT, see the Department of Treasury and Finance’s Building approvals economic brief.

Residential construction

Work done

In the year to March 2020:

• the value of residential construction work done in the NT fell 24.3% to $315 million, the lowest value since September 2001.
• the fall reflects declines in the value of building work done for new houses (down 29.4% to $152 million), new units (down 44.1% to $42 million) and alterations and additions (down 3.8% to $121 million)
• private sector construction activity decreased by 23.0% to $213 million and public sector activity fell by 26.8% to $102 million.
• For the latest data and analysis on residential construction activity in the NT, see the Department of Treasury and Finance’s Building activity economic brief.

Building approvals

Building approvals can be used as a leading indicator to determine the trend of construction-related activity, which measures the number and value of building work approved for residential buildings.

In the year to May 2020:

• residential building approvals in the NT fell 21.2% to 536 approvals (Chart 8)
• approvals for other residential (units, townhouses, etc.) decreased by 22.6% to 120, houses declined by 21.7% to 401, and alterations, additions and conversions increased by 15.4% to 15.
• the value of total residential building approvals in the NT fell 5.1% to $331 million
• For the latest data and analysis on residential building approvals in the NT, see the Department of Treasury and Finance’s Building approvals economic brief.

Explanatory notes

• This analysis is based on the most recent Australian Bureau of Statistics (ABS) quarterly data on engineering construction and building activity, and the monthly data from the building approvals surveys.
• The ABS’s quarterly data on engineering construction and building activity is measured on a value of work done basis, compared to the GSP data. GSP data reflects the total gross value added to GSP by the industry, which includes wages paid to employees and value of construction work done. The engineering construction survey data excludes the cost of land, and repair and maintenance activities as well as the value of any transfers of existing assets.
• The ABS building activity survey is compiled using building approval details and returns collected from builders and other individuals and organisations engaged in building activity. The estimates represent all approved public and private sector residential building jobs valued at $10,000 or more and non-residential building jobs valued at $50,000 or more. The statistics relate to building activity so construction activity not defined as building such as the construction of roads, bridges, railways and earthworks are found in other ABS publications.
• The ABS’s building approvals survey is also used as a leading indicator to determine the trend of construction-related activity, which measures the number and value of building work approved for residential and non-residential buildings. This survey measures the number and value of building work approved for residential and non-residential buildings, including all approved residential buildings valued at $10,000 or more and all approved non-residential buildings valued at $50,000 or more.
• The Department of Infrastructure, Planning and Logistics (DIPL) also publishes a construction snapshot on a quarterly basis. The DIPL’s construction snapshot provides an overview of construction activity for major works over $500,000, reflecting both current and potential future construction-related work for NT regions. To view the latest construction snapshot, refer to DIPL’s publications on their website.