A survey of Victorian architects has found around $6.85 billion worth of the state’s construction sector is in jeopardy as a result of the pandemic lockdowns.
The survey conducted by the Association of Consulting Architects received responses from 196 practices, representing 1,215 full time technical staff and 161.5 full time equivalent casual technical staff.
Around 80 percent of practices reported having project cancelled or put on hold, with $2.3 billion worth of projects cancelled and $4.55 billion put on hold. This amounted to a total of $6.85 billion worth of projects or an average of $36.8 million worth for each firm. The cancelled or on-hold projects represent around 16 percent of the total construction sector, which included $42.4 billion worth of projects in 2018-2019.
The survey sample represents 18.7 percent of Victoria’s 1,046 architectural companies registered with the Architects Registration Board of Victoria. Most of the responding practices (67 percent) are very small enterprises employing five people or fewer.
The survey found widespread concern for current and future work with 28.49 percent of practices having less than two months of work in the pipeline and just 15.7 percent of practices having more than six months of work.
A majority of responding practices experienced declines in revenue, with just 10.5 percent reporting no decline. More than two-thirds (69 percent) of practices are receiving the federal government’s Job Keeper wage subsidy, which is preventing a majority of practices from staff losses. However, 11 percent reported that Job Keeper has not prevented staff redundancies or stand downs.
Around one in five (22 percent) of practices have had to make changes to employment arrangements, most commonly by reducing working hours (50 percent), changing roles (33 percent), reducing pay (32 percent), standing down staff (15 percent), or instituting redundancies (12 percent).
Responding practices reported that the residential sector was most sensitive to declines, with 66 percent contributing to project cancellations, followed by the commercial sector at 14 percent.
Respondents also reported that while the federal government’s Home Builder grant scheme had resulted in increased enquiries it was not having any effect in generating new projects due to the time restrictions of the grant, which stipulate that contracts must be signed before 31 December 2020 and construction must begin within three months of the contract date.
Respondents called for further government stimulus measures, including extending Job Keeper to sole traders and increasing infrastructure spending in public, education, health, community and housing projects.
They also called for the mandatory involvement of architects in design and construction of buildings greater than three storeys – something that architects have advocated for repeatedly throughout the development of Victoria’s apartment design standards.
The ACA’s survey was conducted between 20 and 27 August, three weeks after the stage four restrictions came into effect, which mandated that architectural services close their on site operations and limited workers on construction sites to 25 percent.
The full results of the survey can be found on the ACA website.