The 2024 Construction Industry Survey, a yearly collaborative initiative between Teletrac Navman and Civil Contractors New Zealand (CCNZ), reveals that the civil construction industry is in crisis. The survey indicated that 64% of businesses consider a significant lack of work to be their main concern, a notable increase from 29% in 2023.
Moreover, 57% of businesses are experiencing challenges with procurement guidelines and work consent conditions from local and central governments, an increase from 36% last year.
“The industry’s landscape has dramatically changed in the past 12 months, with an acute shortage of work now being the primary challenge civil construction businesses face. If we conducted the survey again today, the response would be even more dire. Right now, I am fielding daily emails from our members, who are deeply concerned that their businesses may not survive,” Alan Pollard, CEO of CCNZ, said.
“I can’t stress enough the importance of a well-defined, committed, and funded pipeline of work. The government needs to act quickly to restore business confidence. Promises alone won’t get things built,” he added.
Only 37% of the survey participants said they’re expecting revenue growth in 2024, a notable decline from 47% in 2023. Confidence in the industry’s future has significantly dropped, with just 20% of businesses expressing optimism, while belief in their ability to cope with challenges has fallen from 62% in 2023 to 57% in 2024.
The labour market within the civil construction sector also mirrors the general decline. Currently, only 39% of businesses anticipate needing more employees, a decrease from 54% in 2023.
Despite the challenges, businesses are increasingly embracing technology to boost work efficiency and output. The survey has revealed that 77% of companies have employed critical technologies such as fleet management, and 63% use machine control technology. Close to 40% of companies now require specific technologies for bidding on projects, an increase from 27% in the past year.
New Zealand’s infrastructure has shown a slight increase in confidence regarding its ability to manage climate change impacts, rising from 7% in 2023 to 13% in 2024. However, this improvement does little to eliminate the broader challenges faced by the industry.
The survey also highlights the critical need for a strategic focus on government project pipelines and diversity initiatives in the infrastructure industry. 56% of the respondents said having a clear pipeline of government projects is essential for positive impacts, while 62% said they believe that diversity initiatives positively affect productivity. Additionally, 26% consider sustainable energy solutions, such as hydrogen, as a future energy source.