The nation’s construction sector has hit a seven month low in April, according to the latest Australian Industry Group (Ai Group)/Housing Industry Association (HIA)’s Australian Performance of Construction Index (PCI).

The PCI fell 3.8 points in April to finish at 35.2, where any reading below 50 indicates a contraction, and the distance from 50 indicative of the strength of the decline.

Not only has construction declined, but employment has plummeted by 9.4 points to end at 29.8 , the weakest employment reading since the index started seven years ago.

New orders (37.7) and deliveries from suppliers (40.4) were also lower.  None of the four major construction sub-sectors recorded an expansion in the month.

 "The decline in construction activity in April is a further setback to an industry already under intense pressure.  These pressures are particularly hard felt in the residential and commercial construction sub-sectors,” Australian Industry Group Director – Public Policy, Peter Burn, said.

  • Australian PCI® Key Findings for April:
    The latest seasonally adjusted Australian Industry Group/Housing Industry Association Australian Performance of Construction Index(Australian PCI®) was 3.8 points weaker at 35.2 in the April (readings below 50 indicate a contraction in the industry with the distance from 50 indicative of the strength of the decline)
  • The Australian PCI® has now been contracting for 35 consecutive months.
  • Across the sub-sectors – house building declined 9.2 points to 37.8, engineering construction registered a  fall of 4.0 points to 34.4 and apartment building remained unchanged in April at 34.2. The rate of decline in commercial construction eased slightly, although at 31.3, it continued to exhibit the weakest conditions of all sectors. 
  • The input price sub-index was 68.3 (up 2.9 points from the previous month) while selling prices continued to decline with the sub-index at 35.9.
  • Many businesses linked the on-going declines in activity to subdued levels of incoming work and tight credit conditions. House builders indicated a reduction in customer enquiries and weaker order books in the month.