Engineering Construction Data for Dec Released
The ABS has released its Engineering Construction Work Done data for December today with mixed results. Overall activity was down 3.7% QoQ and 5.1% YoY however there are some positive signs. Despite two quarters of contraction, Roads, Highways and Bridges remain at record levels thanks to the East coast infrastructure boom. Given the weather impacted quarter this sector should return to growth in 2019 supported by a strong pipeline particularly in Sydney and Melbourne.
The biggest mover in the quarter was Pipeline work which jumped significantly QoQ as major tunneling works get underway. With the Snowy 2.0 now in pre-construction we can expect to see this trend continue out into 2020/21. Oil, Gas, Coal and minerals returned to positive growth as a number of project announcements in mid-2018 are starting to turn soil including renewed gas exploration in Queensland.
It looks as though the Harbour sector has peaked and is now entering a contraction pending any renewed works driven by the mining sector. The last sector of note is Recreation which is slowly gathering steam – expect this to rise significantly in 2019/2020 on the back of numerous stadium projects slated to commence in the coming months.
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