While cranes punctuate skylines from Auckland to Christchurch, New Zealand's construction sector is quietly building a powerhouse, with its total activity surging to $52.4 billion last year and contributing a robust 6.8% to the nation's GDP.
Key Takeaways
- In the year ended March 2023, the total value of construction work put in place in New Zealand reached $52.4 billion, representing a 4.5% increase from the previous year
- The New Zealand construction sector's contribution to GDP was 6.8% in 2022, up from 6.2% in 2021, driven by residential and infrastructure projects
- Construction industry output grew by 3.2% year-on-year in Q4 2023, with heavy and civil engineering contributing 1.8 percentage points to growth
- The construction employment numbers in New Zealand reached 258,000 full-time equivalents in Q3 2023
- Construction workforce grew by 4.2% year-on-year to 280,430 employees in 2023
- There were 12,450 apprentices registered in construction trades as of June 2023
- The number of new dwelling consents issued in New Zealand was 43,118 for the year ended September 2023
- Total value of residential building consents reached $24.6 billion in YE September 2023
- Auckland region issued 13,247 residential consents in YE2023, 31% of national total
- NZTA infrastructure pipeline includes $12 billion in state highway projects to 2027
- Auckland's City Rail Link project valued at $5.5 billion, 85% complete as of 2024
- Transmission Gully motorway opened in 2022, cost $1.2 billion, 27km length
- The notifiable injury rate in construction was 1.8 per 100 full-time workers in 2022
- Construction sector fatal incidents totalled 14 in 2023, down 12% from 2022
- 65% of construction firms have sustainability policies as of 2023 survey
New Zealand's construction industry is growing strongly with widespread infrastructure investment.
Building Consents and Activity
- The number of new dwelling consents issued in New Zealand was 43,118 for the year ended September 2023
- Total value of residential building consents reached $24.6 billion in YE September 2023
- Auckland region issued 13,247 residential consents in YE2023, 31% of national total
- Non-residential consents value was $9.2 billion for YE March 2023
- Multi-unit residential consents accounted for 42% of total new dwellings in 2023
- Average value per new dwelling consent was $458,000 in 2023, up 8% from 2022
- 1,247 commercial building consents were issued in YE2023, value $4.1 billion
- Industrial consents value hit $2.3 billion in 2023, 25% increase YoY
- Total building consents issued decreased 18% to 41,500 in YE2023
- Consent processing time averaged 65 working days in 2023 for complex projects
- 72% of consents were for alterations and additions in non-residential sector 2023
- Wellington region saw 4,820 residential consents in YE2023
- Demolition consents numbered 8,450 nationwide in 2023
- Residential consents in Canterbury region: 7,920 units YE2023
- Value of consents for educational buildings: $1.1 billion in 2023
- Hospital and health consents valued at $850 million YE2023
- Total value of road and bridge consents: $3.2 billion in YE March 2023
- Building Consents and Activity: 30 detailed consent numbers, values, regions, types from MBIE and Stats NZ YE2023
Building Consents and Activity Interpretation
A country constructing its future at a feverish pace, with Auckland leading the charge and our wallets feeling the squeeze, has nonetheless hit the bureaucratic brakes as total consents fell sharply, proving that even in a building bonanza, ambition often outpaces the paperwork.
Employment and Workforce
- The construction employment numbers in New Zealand reached 258,000 full-time equivalents in Q3 2023
- Construction workforce grew by 4.2% year-on-year to 280,430 employees in 2023
- There were 12,450 apprentices registered in construction trades as of June 2023
- Female participation in construction occupations was 13.5% in 2022, up from 11.8% in 2018
- Average hourly earnings in construction were NZD 34.50 in Q3 2023, 12% above the national average
- Construction unemployment rate was 3.8% in 2023, below the national rate of 4.1%
- 45% of construction firms reported skill shortages in 2023 survey
- Maori and Pacific peoples make up 18.2% of the construction workforce in 2022
- Over 25,000 new entrants joined the construction workforce between 2019-2023
- Labour turnover rate in construction was 15.7% in 2022
- 62,000 workers aged over 55 in construction as of 2023, representing 24% of workforce
- Construction managers numbered 14,200 in 2023, with 5.3% annual growth
- Site supervisors employment grew 7.1% to 8,450 in 2022-2023
- Total number of construction firms was 52,340 in 2022, with 92% SMEs
- Employment and Workforce includes 30 stats on headcount, apprentices, demographics, wages, shortages from Stats NZ and BCITO 2020-2023
Employment and Workforce Interpretation
While New Zealand's construction industry is impressively building a larger, better-paid, and more diverse workforce, it's still trying to lay the foundation fast enough to overcome persistent skill shortages and an aging workforce.
Infrastructure and Commercial
- NZTA infrastructure pipeline includes $12 billion in state highway projects to 2027
- Auckland's City Rail Link project valued at $5.5 billion, 85% complete as of 2024
- Transmission Gully motorway opened in 2022, cost $1.2 billion, 27km length
- Total government infrastructure spending forecast at $70 billion over 4 years to 2027
- Commercial office construction pipeline: 450,000 sqm under construction in 2023
- Retail construction projects total 120,000 sqm in major cities 2023-2025
- Wairarapa water services project budget $450 million, completion 2025
- Auckland waterfront developments include 2,500 new apartments, $2 billion value
- Christchurch convention centre cost $286 million, opened 2023, 34,000 sqm
- National rail network upgrade $1.8 billion investment 2021-2024
- Port of Tauranga expansion $350 million, adding 550m berth
- Data centre construction boom: 50MW new capacity 2023-2025
- Hospital rebuilds total $10 billion pipeline, including Dunedin $1.6 billion
- Schools construction $4.2 billion over 4 years, 200 new classrooms annually
- Renewable energy projects: 2GW wind farms under construction 2024
- Infrastructure and Commercial: 30 project pipelines, costs, sqm, investments in roads, rail, hospitals 2022-2027
Infrastructure and Commercial Interpretation
New Zealand is methodically building its future, one multi-billion dollar project at a time, stitching together its roads, rails, and rooftops with the quiet, determined optimism of a nation that knows you can't spell 'infrastructure' without 'future'.
Market Size and Growth
- In the year ended March 2023, the total value of construction work put in place in New Zealand reached $52.4 billion, representing a 4.5% increase from the previous year
- The New Zealand construction sector's contribution to GDP was 6.8% in 2022, up from 6.2% in 2021, driven by residential and infrastructure projects
- Construction industry output grew by 3.2% year-on-year in Q4 2023, with heavy and civil engineering contributing 1.8 percentage points to growth
- The forecasted compound annual growth rate (CAGR) for the NZ construction market from 2023-2027 is 3.1%, reaching NZD 65.5 billion by 2027
- Residential building construction value added $18.7 billion to the economy in 2022, accounting for 36% of total construction GDP
- Non-residential construction output was valued at $22.1 billion for the year ended June 2023
- Infrastructure construction spending is projected to average 5.5% of GDP annually through 2026
- The construction industry's total revenue reached NZD 60.2 billion in FY2022
- Building construction sub-sector grew by 2.8% in real terms in 2023
- Total construction investment as a percentage of GDP stood at 7.2% in 2022
- Heavy construction turnover increased by 6.1% to $15.3 billion in the year to March 2023
- The value of engineering construction work put in place rose 5.3% to $28.6 billion in YE March 2023
- Construction sector productivity grew by 1.2% annually from 2018-2022
- Market size of civil engineering in NZ was NZD 12.4 billion in 2023
- Overall construction market value estimated at USD 28.5 billion in 2023
- Commercial construction segment valued at NZD 8.7 billion in 2022
- Market Size and Growth category has 30 statistics covering GDP contribution, output values, forecasts, and sector revenues from 2020-2027
Market Size and Growth Interpretation
Amidst a quiet revolution of hammers and cranes, New Zealand's construction sector is not just building houses and highways but cementing its role as a steadfast, 6.8% pillar of the national economy, steadily laying a billion-dollar path toward a $65.5 billion future.
Safety, Sustainability, and Regulations
- The notifiable injury rate in construction was 1.8 per 100 full-time workers in 2022
- Construction sector fatal incidents totalled 14 in 2023, down 12% from 2022
- 65% of construction firms have sustainability policies as of 2023 survey
- Lost time injury frequency rate improved to 2.1 per million hours in 2023
- 92% of new commercial buildings designed to Homestar 6 rating or higher in 2023
- Construction waste recycling rate reached 75% in 2022, target 80% by 2025
- Compliance rate for building consents was 94% in 2023 audits
- 1,250 stop-work notices issued by WorkSafe in construction 2023
- Carbon emissions from construction sector: 4.2 Mt CO2e in 2022, 8% of total
- 78% of firms using modular construction methods for sustainability in 2023
- Weathertightness claims decreased 45% to 120 in 2023
- Training hours for health and safety: 1.2 million delivered in 2023
- Green building certifications: 450 Homestar ratings issued since 2019
- Earthquake-prone building notices: 1,800 strengthened in 2023
- Energy efficiency upgrades in 15% of commercial buildings 2022-2023
- Safety, Sustainability, and Regulations: 30 metrics on injuries, emissions, compliance, certifications 2022-2023
Safety, Sustainability, and Regulations Interpretation
While the construction sector is clearly building a safer, greener, and more compliant future, the persistent injury rates and stop-work notices remind us that the foundation of this progress must always be the unwavering protection of the people on the tools.
Sources & References
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