Every $1 spent in building and construction produces $3 to support wider economic activity and jobs.
Master Builders Australia’s CEO Denita Wawn says that the Federal Government’s hugely successful HomeBuilder scheme is yet more evidence that the building and construction industry is the awesome accelerator of economic recovery.
The building and construction industry has a significant multiplier effect that drives the economy, it not only protects jobs but also create more jobs. An outstanding example would be the HomeBuilder scheme.
In addition to the significant direct impact on economic activity, the building and construction industry supports other sectors of the economy as well. An EY modelling commissioned by Master Builders and published in 2020 estimated the economic benefits from potential stimulus to the construction industry. It concluded that for every $1 of Federal Government stimulus to the industry, gross domestic product (GDP) would increase by between $1.22 and $3.28 depending on how it was targeted. Analysis shows that $1 million of output in home construction supports $2.9 million in output and nine jobs across the economy, more investment is needed to make sure the economy keeps on recovering. Commercial construction generates cash flow into the wider economy, creating a ripple effect.
Additional analysis by Master Builders has estimated the impact of all components of construction activity on the demand for Australian-produced products and services. Our analysis found that in 2017–18, construction activity generated $189.7 billion worth of demand for products and services in other areas of the Australian economy – with the most support going to professional services ($23.5 billion), metal manufacturing ($17.7 billion) and sawmill/wood processing manufacturing ($16.6 billion)
Find out more in Master Builders Pre-Budget Submission here: https://bit.ly/3cUQcTv