Growing tensions in the construction industry

New Zealand is experiencing increased pressure in its infrastructure sector. The recent earthquakes experienced on 14th November further hit home the fragility of this industry. It has been said that the nation’s economy has largely escaped any short-term consequence from the recent tremors, but there appears to be a growing unease among economic commentators that it will add a further level of strain to the already stretched industry.

The first key consequence New Zealanders are predicted to experience is that the cost of building will rise. This is predominantly because transport links have been badly affected and alternative options that are being explored are costly in comparison. ASB chief economist Nick Tuffley said the South Island will predominantly bear the brunt of this anticipated cost inflation.

The workforce in this sector is also likely to experience increased pressure in the forthcoming weeks and months, and as a result, new workers are likely to be brought in from overseas. It has been noted however that this temporary demand may lead to overstaffing in the industry, and may add possible complications of unemployment in the future.

Nevertheless, the ramifications of the seismic activity have provided an unpleasant reminder that the success of this sector is dependent on the interaction of many different factors. As stated, these include the availability of transport routes, natural and human resources, and a functioning legislative framework. At its core though, the above problems demonstrate that harmony between all factors are required to ensure prosperity in the industry.

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