Downturn to look up from 2010

The report, called Australian Construction Outlook 2009 – Non-Residential Building, said there would be a gradual improvement in economic activity and demand for buildings during 2010, with the recovery in commercial and industrial building work to start in 2010-11. The report said office building commencements were not forecast to recover until 2011-12.Report author Nigel Hatcher said the current downturn was serious, but it wouldn’t be as bad as the two worst previous downturns – in the mid-1970s and early 1990s.“The recently released ABS data confirms that a sharp decline is taking place,” he said. “In the December quarter 2008, the value of non-residential building work commenced was down more than 30% in real terms on the December quarter 2007, and this rate of decline will likely worsen in the March quarter 2009, based on approvals data which is currently available up to February.”Hatcher said the rate of decline was actually faster than the early 1990s downturn, which followed the late 1980s boom.“But this time the downturn should last about half as long and not be anywhere near as severe in totality,” he said.

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