The analyst expects the Australian construction industry to grow by 3.1% in real terms in 2025, supported by investments in manufacturing, transport, and renewable energy infrastructure, coupled with an improvement in the residential construction sector. According to the Australian Bureau of Statistics (ABS), the total value of residential building construction work done in Australia grew by 5.6% year on year (YoY) in Q4 2024, preceded by a YoY growth of 0.6% in Q3 and a YoY decline of 1% in Q2 2024. In March 2025, the Australian Federal government announced the Fiscal Year (FY) 2025-26 (July 2025 to June 2026) Budget, with a focus on energy subsidies, healthcare, education, transport infrastructure, housing, and clean energy, with total expenditure rising from AUD762.8 billion ($504 billion) in FY2024-25 to AUD785.7 billion ($519.1 billion) in FY2025-26. Some of the sectors with significant allocations include social security and welfare at AUD291 billion ($192.3 billion), healthcare at AUD124.8 billion ($82.5 billion), education at AUD54 billion ($35.7 billion), and general public services at AUD31.4 billion ($20.7 billion). However, rising insolvencies are expected to keep challenging the construction industry, with the total number of companies that have undergone insolvency appointments within the construction industry, rising by 33% YoY in January-February 2025, following a rise of 38.8% in 2024, according to the Australian Securities and Investments Commission (ASIC).
Australia's construction industry is projected to grow at an average annual rate of 3% from 2026 to 2029, driven by public and private sector investments in renewable energy, transport infrastructure, and mixed-use projects, coupled with the government’s plan to raise the share of renewables to 82% and cut carbon emissions by 43% (from 2005 levels) by 2030. In line with this plan, in March 2025, the federal government approved 2.4GW of renewable energy projects in New South Wales, including the 1,332MW Liverpool Range, 700MW Spicers Creek, and 372MW Hills of Gold wind farms. These projects, part of the Central West Orana renewable energy zone, are expected to reduce greenhouse gas emissions by 6.5 million tonnes annually. Growth in the industry during the forecast period will also be supported by the Northern Australia Action Plan (2024-29), launched in November 2024, with an investment of AUD30 billion ($19.8 billion). Under this plan, affordable housing units and transport infrastructure will be built in Queensland, Western Australia, and the Northern Territory by 2029. In February 2025, the federal and Western Australian governments announced a joint investment of AUD1.1 billion ($700 million), with each contributing AUD529.7 million ($350 million), to upgrade Western Australia’s Kwinana Freeway. The project aims to improve freight movement, boost economic growth, and expand key sections to increase road capacity.
The Construction in Australia - Key Trends and Opportunities by State and Territory to 2029 (Q1 2025) report provides detailed market analysis, information and insights into the Australian construction industry, including:
Australia's construction industry is projected to grow at an average annual rate of 3% from 2026 to 2029, driven by public and private sector investments in renewable energy, transport infrastructure, and mixed-use projects, coupled with the government’s plan to raise the share of renewables to 82% and cut carbon emissions by 43% (from 2005 levels) by 2030. In line with this plan, in March 2025, the federal government approved 2.4GW of renewable energy projects in New South Wales, including the 1,332MW Liverpool Range, 700MW Spicers Creek, and 372MW Hills of Gold wind farms. These projects, part of the Central West Orana renewable energy zone, are expected to reduce greenhouse gas emissions by 6.5 million tonnes annually. Growth in the industry during the forecast period will also be supported by the Northern Australia Action Plan (2024-29), launched in November 2024, with an investment of AUD30 billion ($19.8 billion). Under this plan, affordable housing units and transport infrastructure will be built in Queensland, Western Australia, and the Northern Territory by 2029. In February 2025, the federal and Western Australian governments announced a joint investment of AUD1.1 billion ($700 million), with each contributing AUD529.7 million ($350 million), to upgrade Western Australia’s Kwinana Freeway. The project aims to improve freight movement, boost economic growth, and expand key sections to increase road capacity.
The Construction in Australia - Key Trends and Opportunities by State and Territory to 2029 (Q1 2025) report provides detailed market analysis, information and insights into the Australian construction industry, including:
- The Australian construction industry's growth prospects by market, project type and construction activity
- Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the Australian construction industry
- Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.
Scope
This report provides a comprehensive analysis of the construction industry in Australia. It provides:
- Historical (2019-2023) and forecast (2024-2028) valuations of the construction industry in Australia, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
Reasons to Buy
- Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
- Assess market growth potential at a micro-level with over 600 time-series data forecasts
- Understand the latest industry and market trends
- Formulate and validate business strategies using the analyst's critical and actionable insight
- Assess business risks, including cost, regulatory and competitive pressures
- Evaluate competitive risk and success factors
Table of Contents
1 Executive Summary2 Construction Industry: At-a-Glance7 Construction Market Data
3 Context
4 Construction Outlook
5 Construction Outlook - States and Territories
6 Key Industry Participants
8 Appendix
List of Tables
List of Figures
