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Engineering construction down in Dec qtr

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AAP

2013-02-27

A fall in commodity prices in the second half of 2012 contributed to a decline in construction activity in the final three months of the year.

Figures released by the Australian Bureau of Statistics on Wednesday show total construction work done in Australia fell 0.1 per cent in the December quarter.

St George economist Janu Chan said the overall decline in the sector was due to a 1.3 per cent fall in engineering construction which includes mines, roads, bridges.

She said a sharp drop in commodity prices in the second half of the year would have contributed to the decline.

She said the the slide came after a period of strong growth in engineering construction, which was up 19.5 per cent in the year to December.

"I guess it's providing evidence it is softening and it does relate to weaker commodity prices coming off," she said.

"There is still quite a lot of (engineering) work in the pipeline, but that growth is easing off," she said.

Ms Chan said the figures also showed a rise in both residential and non-residential construction, which were up 1.7 and 2.0 per cent in the quarter.

"There were some quite healthy gains in those sectors so that was encouraging."