Construction Industry In Australia Construction Essay

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Australia is the sixth largest country in the world. Australia is a democratic country with a parliamentary system and Queen Elizabeth II acting as Governor General in Australia. Australia has about six states and two island territories. Construction industry always plays an important role in any country's economy. In Australia, since last few years' construction industry in Australia is showing a significant growth (Australian Construction Resources, 2011). The contribution of construction industry to Gross Domestic Product (GDP) of Australia is 7%. During the period 2010-2011, construction industry employed 1,033,900 number of people which is 3% higher compared to 2009-2010 (Year book Australia, 2012). During the period 2010-2011, construction has been largest employer with 695,100 average number people in it.

Construction Industry in Australia:

In Australia, construction industry has three different sectors. They are Engineering Construction, Residential Building and Non-residential buildings. These sectors have their own distinct characteristics (Year Book Australia, 2012). The total income of construction industry in Australia has increased to 6%, which was $281 billion during 2008-09 and 2009-10 (Year Book Australia, 2012). In Australia, the construction activity is undertaken by both private sectors and public sectors. During 2008-09 and 2009-10 periods, a profit of 76% was noted in the construction industry (Year Book Australia, 2012). Usually, the construction activity involves construction of engineering works like roads, railways, bridges and finally buildings which is done by both private and public sectors.

Residential Buildings:

In Residential buildings, housing sector is considered to be a small contributor of GDP according to Australian Bureau of Statistics Industry. These are designated as separate houses or semi-detached houses, apartments, flats etc. During the period 2010-11, residential building sector construction valued at $47 billion (Year Book Australia, 2012). The factors which had often affected residential buildings are level of immigration from state and national level, types of changes in household, increased household formation. Population level increase has also been a reason for change in residential building types and locations, where services like health and community services were affected.

The key indicator for future building activities is Building approvals, since construction of buildings begins only after approvals.

Non-residential buildings:

In this sector, private sector had dominated over commercial construction, offices, hotels, shops, factories and business premises like warehouse, service stations, terminals and car parks. Public sector consists of only recreational buildings, educational and health. The value of non-residential buildings has been decreased by 30%, i.e. from $40 billion to $28 billion during the periods 2009-10 and 2010-11 respectively (Year Book Australia, 2012). In this educational and health facilities decreased mainly from $12 billion to £3 billion. The largest decrease in non-residential buildings was for other types with a reduction of $427 million (Year Book Australia, 2012).

Engineering Sector:

In this sector, there are of six major types. They are electrical generation, road and bridge construction, transmission, processing plants (oil and gas pipelines), water and sewerage and other engineering constructions (railways, harbours, recreational facilities). In this sector, most of the work is for urban infrastructure, mining and heavy industry. The value of construction work done for private sector has increased than that done for public sector during 2002-03 and had finally reached $56 billion in 2010-11. The largest changes in the value of construction work done between 2009-10 and 2010-11 were for mining facilities which has increased to $5 billion (Year Book Australia, 2012).


In Australia there are about 73,223 construction and building companies. Out of these 73,223 companies 590 companies are in construction and mining sector (AMMA Resource Industry Employer Group, 2012). In all these companies the top 5 companies are ADCO construction, AV Jennings, BCI Australia, Burbank and Cockram.

ADCO Construction is the leading construction company in Australia. It was established in 1972 and in present situation it has revenue of $500 million per annum and also has about 350 direct employees (ADCO Constructions, 2013). Their successful projects range from $1 million to $100 million. ADCO has branches along New Castle, Cairns, Gold Coast, Melbourne, Townsville, Brisbane and Sydney (ADCO Constructions, 2013).

Types of Major Projects Undertaken in Australia:

Major types of projects in Australia are as follows:

Gorgon Project

Oakajee Port and Rail Project

Wheatstone LNG Project

Gorgon Project:

This is undertaken by Chevron Australian Company in joint venture with shell, Chubu electrical company, Tokyo gas, Osaka gas and Exxon Mobil. This is located in Western Australia and has been stated to be completed by 2014, started on September 14, 2009. This project was estimated at $43 billion. During the construction of project it will deliver $20 billion to local economy.

Wheatstone LNG Project:

This is undertaken by Shell, chevron, TEPCO, Apache, KUFPEC and Kyushu Australia and has been stated to be completed by 2016, started on 2011. This was estimated at $29 billion.

Oakajee Port and Rail Project:

This is still on hold and said to be completed within four years from start date. Estimated at a value of $3.5 billion. This is also located in Western Australia.

Practices that usually come under construction Industry in Australia are Procurement, Legal System, Health and safety, Labour.


Australian Procurement and Construction council is the one that overlooks anything regarding procurement under construction industry in Australia. Australian Procurement and Construction Council have set about eight national principles for procurement in construction industry. They are

Occupational health, safety and rehabilitation

Workplace reforms

Competitive behaviour

Continuous improvement and best practice

Industrial relations and workplace reform

Relationships and

Security of payment

Legal System:

Australian Legislation Reform Sub-committee has been researching, improving and developing practice of construction law in Australia. Every state and territory has its own criminal laws. Their legal system has the basis from United Kingdom's Legal system (Department of Foreign Affairs and Trade, 2012). Construction industry had always been a market where large amount of money invested in it, involving geographical areas within contract time.

Health and Safety:

Safe work Australia is a composed body consisting an independent officer followed by members from each state, territory, workers, employers and also a chief executive officer (Commonwealth of Australia, 2012). Regulatory and operational reform in OHS (Occupation Health and safety) had agreed by COAG (Council of Australian Government) on 3 July 2008. This agreement had been finalized to achieve harmonisation of Occupational Health and Safety laws. As of 31st December 2012, 21 construction workers had been killed during workplace accidents (Commonwealth of Australia, 2012). Strategic issues group for Worker's compensation under safe work Australia agreed on

Fair compensation for deaths, illness and injuries related to workplace.

Support effectively and return to work early

Reduce overall social and economic cost for fatalities, illness and injuries related to workplace.

The following notes is taken from Patchwork-2 on topic labour Practices in Australia.

Labour Practices in Australia:

The types of duties for construction workers in Australia are as follows:

Read common working instructions and technical drawings

Independently plan the method and order of progressing a job

Take measurements and readings using measuring instruments of appropriate accuracy.

Mark out, lay out and set up work.

Select appropriate techniques, materials, tools, machines and for equipment.

Check and test their work in relation to relevant standards.

Carrying out given tasks in a safe and timely manner (Trade Recognition Australia, 2003).

In general, a worker's experience is highly considered against duties of construction. Their skills are assessed by assessor who is a qualified assessor from Australian Recognition Framework (ARF)

The Contribution of construction industry to Australian economy during 2010-11 was $102 billion (Year Book Australia, 2012). Between May 2006 to May 2009, the number of people employed in it was 984,100 (Australian economic indicators, 2010). Out of which 65.4% were in construction services, 23.5% in building construction, 71% in heavy and civil engineering construction and finally 3.9% in general construction activities. During these period average working hours per week by an employee in construction industry was higher than other employees. Even the average weekly earnings for employees in construction industry is higher when compared to other industry employees (Australian Economic Indicators, 2010).

Work Hours:

The working hours of labours in construction industry varies with one on three labours employed on full time basis i.e. 40 hours per week. 31% of labours in construction industry work less than 40 hours a week, while 39% of them work more than 40 hours a week (Australian Economic Indicators, 2010).


39% of workers in construction industry don't have a post-secondary education. Half of the workers, who hold a post-secondary education, have a certificate level qualification (46.5%) (Australian Economic Indicators, 2010)


During 2009-10, 12,500 employees or workers were involved in industrial disputes in construction industry. In the same period, the number of working days lost in the construction industry due to industrial disputes increased to 175.3%, compared to 23.5% of all other industries. The number of construction labour involved in disputes has fallen to 84.3% since 2004-05, while the number of working days lost for workers has fallen to 80.1%. the average age of construction worker is 38.5 years and construction industry is the sixth youngest industry across all other sectors(Australian Economic Disputes, 2010)


Construction Forestry, Mining and Energy Union (CFMEU) are the one which overlooks towards labour in construction industry, forestry, mining and energy union. This has 3 divisions

Construction and General division

Forestry and Furnishing Products division

Mining and Energy division.

CFMEU is fighting to improve the wages and condition of workers in Australia. The Australian Government has formed a new workplace regulator for construction industry "Fair work Building and Construction". Fair work Building and Construction regulates workplace laws in the building and construction industry. It does this through advice, education and compliance activities including audits and investigations. Workers can complaint about their minimum wages and conditions to Fair Work Building and Construction. Fair work Building and Construction investigates under payments, sham contracting and any other denial of entitlements.

Health and safety:

Occupational Health and Safety laws and New work health and safety laws will help the labour to avoid unnecessary costs and damage caused in workplace. In Occupational health and safety there is a worker's compensation requirements, where if a work related accident or illness occurs then the injured workers must have access to first aid, fair worker's compensation and return to work rehabilitation. The employer has a responsibility for

Maintaining a safe workplace

Current workers compensation insurance

Protect themselves and workers from financial hardship in the event of workplace injury.

If a accident occur on a workplace, then they are entitled to make a workers compensation claim. Usually, accidents are to be recorded in accident log for insurance purposes. It's a employers responsibility to make sure all employers understand their rights and responsibility relating to workplace accidents. Under state and territory laws, an employer must report about events such as death, serious injury or dangerous incident that could lead to death or injury. Under these laws employer must provide rehabilitation, compensation or suitable duties to injured worker (Australian Health Survey, 2011-12).

The following notes are on differences between labour in construction industry between India and Australia.

Introduction about India:

India is the world's fasted growing economy (Nayak, Goldar and Agrawal, 2010). In India construction activity is considered to be second largest economic activity after agriculture. The total investments in infrastructure by construction industry accounts for 65% (Indo-Italian Chamber, 2008). In Gross Domestic Products construction industry contributes about 11%. Number of workers employed in construction industry account for 5,543,000 in the year 2000.

Labour in India:

In India, construction industry is the largest employer for labour. The total women workforce in India working in construction industry is about 30%. The average weekly hours are high for labour in India, where they need to work 6 days per week (Dave spooner and Annie Tiopley, WIEGO). Women labours in construction industry have duties like breaking stones, mixing cement, digging earth, carrying cement, sand, water and bricks.(WIEGO, ). Officially, the labour had to be paid Rs.150/- per day (Minimum Wages Act, 1948). But it usually varies according to states in India. The labour agrees to work for less pay because they don't have job security. The risk factor is high due to workplace accidents resulting in temporary or permanent disabilities. They don't even have insurance coverage and wages will be lost for the time period taken for rest.

Demerits in Indian Construction Labour:

Labour's earning usually depends on contractor, not on how many hours they work. Since, they have stiff competition due to migrant labour they often agree for low wages. There are unions for labour in construction industry; every state has their own (SEWA, 2000). The main barrier for construction labour in India is their caste and language. Officially, 30 languages are considered as regional languages, out of hundreds of language. In these Hindi is considered as national language. Political involvement in construction industry is high. Child labour in Indian construction industry is strictly prohibited. Out of every 1000 workers 165 are injured from a study conducted by international labour organizations.

Differences between Australian and Indian Labour force:

The main differences between Indian and Australian labour is their union. In india, there are many unions for labours but in Australia they have a single union all over the country known as Construction Forestry Mining and Energy Union. In Australia they speak English all over the country but in India there are many languages and they differ from state to state. Health and safety of labour in Australia are given more priority in Australia whereas in India it's low. The work hours of Labour in Australia per a day is 8 hours and for 5 days a week whereas in India it is from sunrise to sunset and for 6 days a week, also they need to work on Sundays to meet deadlines. Even Health and Safety precautions for labours on worksite are high in Australia compared to India.

Health and safety differences between India and Australia:

In India, labours give more importance to work because of their standard of living. Hence they have low importance for occupational safety and health. In Australia, health and safety at workplace are given more importance they even have rules like workers insurance, compensation and return to work rehabilitation. In India even though government of India creates laws for protection of labours, they aren't aware of these laws because of their educational background. These people are mostly uneducated who doesn't even have post-secondary education. In India, construction workers federation is the recognised trade union. The union had undergone a strike for implementing "Building and other construction workers Act 1996" and also for housing for all construction workers. In India, the states have individual labour boards which have to register construction workers but due to lack of staff and inadequate resources, the registering of labours isn't done properly. This shows that number of injuries and deaths of labour remain invisible. If these deaths or injuries are related to high profile project, only then we know about them through T.V and newspaper. Usually, Builders are required to inform about labours death to labour officials within 72 hours (Madhavi Rajadhyaksha, 2012).