The impact of the COVID-19 pandemic has been as profound as it has been widespread. The construction industry in Australia is no exception. With a sector scrambling to source the materials to keep projects from grinding to a halt, the consequences of tenuous supply chains have come into sharp relief.
In this blog post, we’ll ask pressing questions about Australia’s dependency on construction imports in the wake of the pandemic. What does this reliance mean for the industry? How has the pandemic exacerbated existing problems? And can we reinvigorate a manufacturing sector that has been declining for decades? At Littlehampton Bricks and Pavers, we believe so – and it all starts with buying local.
A Manufactured Decline
Australia has long been known for its vast natural resources. Particularly minerals such as iron, gold, and copper. In the late 1980s, manufacturing was the biggest employer nationally, supplying the country with 16.5 per cent of its workforce. Today, under one million Australians populate the sector, accounting for 6.4 per cent of the country’s labour.
While it’s indisputable that our export of minerals and services has contributed to a robust economy and consistent ranking amongst the world’s most liveable countries, Australia has become increasingly dependent on imported products. This trend has grown particularly prevalent in the construction industry. As Dr Jim Stanford, director of the Australia Institute’s Centre for Future Work, observes:
“Australia has one of the most underdeveloped manufacturing sectors of any industrial country in the world…there is a mistaken assumption that if you’re a rich, high-wage, industrial country, you just can’t do manufacturing. We found that traditional assumption is absolutely false.”
Australia’s reliance on imported products has a range of far-reaching consequences, including a fragile supply chain, a decline in domestic jobs, materials that fail to meet Australian Standards, and stunted manufacturing research. We must look to build a more robust domestic manufacturing base to reduce our dependence on imported products. However, such an endeavour will require significant investment in infrastructure, skilled labour, research and development, and the vested effort of citizens and businesses to ‘buy Australian’.
A Fragile Supply-chain
The COVID-19 pandemic has highlighted the severity of the Australian construction industry’s reliance on imported products. Efforts to suppress the virus led to widespread factory closures and container shipping delays for top manufacturers.
China alone provides 60 per cent of Australia’s annual $6 billion worth of construction materials, which in turn account for approximately 20 percent of the total cost of a single construction. Consequently, measures to stem the virus resulted in a shortage of construction materials such as timber, windows and steel. As Australian Forest Products Association (AFPA) CEO Ross Hampton observes:
“The critical timber shortages of the past two years have exposed Australia’s over-reliance on timber imports, which have become more expensive and difficult to source, which has driven up building costs and significantly delayed construction.”
Construction delays caused by the pandemic are estimated to have served a $1.4 billion blow to the NSW economy alone. With a manufacturing sector incapable of supporting a burgeoning demand, Australia faces an uncertain future for the reliability of its construction supply chain.
Cheap labour and manufacturing processes come with hidden costs. The most obvious of these is a sacrifice in quality. Australian construction workers have long been aware of the inferiority of many imported products. The Australian Steel Institute and the Welding Technology Institute of Australia described the Chinese-made steel flooding Australian shores as ‘dangerous’ and ‘unacceptable’ in failing to meet Australian safety standards.
Further, harrowing examples, such as Melbourne’s 2019 Neo200 apartment tower fire, fuelled by combustible cladding, resulted in the Victorian state government committing $600 million to remove imported combustible cladding from 100 higher-risk residential buildings annually for five years. The high cost of rectifying dangerous building materials reminds us of the dangers of prioritising profits over quality.
The increasing demand for imported materials has resulted in a dramatic loss of jobs in the domestic manufacturing sector. Today, manufacturing contributes only 5% to GDP and only 5.4% to total employment. With a limited job market and support from domestic sectors, local companies are less able to invest in research and development. This lack of investment stifles innovation and the ability of businesses to develop new products and processes that are uniquely suited to the Australian climate and conditions.
Benefits of supporting local manufacture
While we have explored the consequences of Australia’s reliance on imported construction materials, Australian manufacturers have substantial potential to benefit from a growing demand for locally-sourced products. Confronted with supply-chain breakdowns and imports of dubious quality, it becomes paramount for the Australian construction industry to look inwards and invest in the nation’s manufacturing sector.
A strong domestic manufacturing base supports economic growth and ensures that the products used in construction meet Australian Standards. This creates a virtuous circle of investment and innovation, as businesses reinvest profits into research and development to develop new products and processes. In the long term, a well-established domestic manufacturing sector will create a more resilient construction industry that is less susceptible to the vagaries of global events.
Bricks Made for Australia
At Littlehampton Bricks and Pavers, we understand the benefits of investing in quality Australian-made products. We have been manufacturing clay bricks in South Australia for over 120 years. Our business is based on three key pillars – quality, service and innovation.
As a proud Australian manufacturer, we are committed to supplying our customers with the highest quality bricks backed by our innovative process, friendly service and unwavering customer support. We take pride in crafting solutions tailored to the Australian climate, made from Australian clay and toil.
At Littlehampton Bricks and Pavers, we’re committed to a 100% Australian-made and owned ethos. We recognise the exceptional value of Australian clays and minerals, which is why we source the best locally available raw materials to produce our bricks. Our process is designed to ensure that these quality aggregates are used to their fullest potential, resulting in strong and durable products with a rich and unique character. We know that investing in Australian manufacturing is key to ensuring our industry’s prosperous future and the well-being of our unique ecosystems. Through our focus on local and sustainable practices, Littlehampton Bricks and Pavers aims to set the standard for excellence within the brick industry, respecting the needs of our ecosystems, communities, and customers.We know that investing in Australian manufacturing is key to ensuring our industry’s prosperous future and the well-being of our unique ecosystems.
There are numerous consequences to Australia’s dependency on imported products in the construction industry, including an increased cost of construction, sub-standard quality products, and stunted innovation. However, there are also benefits to supporting local manufacturing, such as economic growth, investment in research and development, and a more resilient construction industry.
The COVID-19 pandemic has served as a wake-up call for Australians, highlighting the dangers of over-reliance on imported goods. If we are to build a stronger, more resilient construction industry, we must make a salient effort towards investing in our domestic manufacturing sector.