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Business will struggle to cope with infrastructure boom

Thursday, 15 May 2008

James Thomson

The details around the Government’s new $20 billion Building Australia infrastructure fund might be sketchy, but one thing is certain – business needs to get ready for a decade-long infrastructure boom.

SMEs involved in everything from engineering, project management and recruitment, transport, construction, manufacturing and trades of all types should benefit from the flurry of spending set to start from 2009-10.

But there’s one problem – most of these industries are already running at full capacity and finding new staff to cope with the extra work will be a challenge.

Greg Evans, director of industry policy and economics at the Australian Chamber of Commerce and Industry, says engineering and those in the building and construction industry will benefit most from the establishment of the fund. And he’s not concerned that the fund will not start investing until 2009-10. “I don’t think we have the immediate capacity to actually start these projects.”

Andrew Buckley, chief executive of listed engineering firm Cardno, feels like he’s already in the middle of an infrastructure boom. “It’s just going to continue at the very high levels we’ve seen for the last few years. But it’s pretty hard work for everyone to find the resources to stay on top of things.”

Peter Taylor, chief executive of Engineers Australia, has welcomed the establishment of the fund, but has similar concerns about the ability of engineering companies to find the resources needed to take on new work. “We’ve estimated there is a very significant shortage of engineers in Australia, somewhere between 20,000 and 30,000.”

Buckley hopes that the predicted slowdown in the Australian economy will free up some workers, but hopes to gain some more flexibility by shifting workers around within his business (including from the US, where the economy is slowing much quicker than Australia) and shifting work from office to office. There is no reason that, for example, the structural work for a project in Adelaide cannot be done in Brisbane. “We’re very much focused on sharing resources.”