Core Issues

Changing Economic Outlook
Inflation is likely the toughest issue the sector is facing. The latest Statistics New Zealand consumer price index increased 7.2 percent in the 12 months to December 2022, holding steady from the quarter before. However, tradable inflation, which includes goods and services that are imported or in competition with foreign goods, was at 8.2 percent. Everyone in our sector is feeling this strain.

We know this is a difficult time for a lot of our members due to the challenges facing the industry.  To help support you through this period, we have developed a new initiative to help ensure the financial stability of our members.

Master Builders is looking to carry out financial checks for selected members over the coming months. We are continually evolving and developing our support services, and this is an important new offering to help our members navigate their way through a residential building downturn.

Building Material Shortage
We are aware that many members are facing the challenges of material supply constraints, both in procuring the products and in managing delays and pricing issues.

The Master Builders team continues to advocate on these issues. This includes publicly communicating that New Zealand is experiencing global disruption, creating unpredictable and rising material costs and delays that are outside the control of our members, which in turn is making it very difficult to determine exactly how much a build will cost. We have been working with the Construction Accord, and our Chief Executive David Kelly has appeared in front of the Select Committee to convey how this is impacting our members.

As members the key is to communicate and be up front and honest with your clients. Provide realistic timelines and cost structures and talk openly about the risk – then together you can manage this. If clients are also clear about their budgets, the builder can provide options that will fit within those and work together to get the best possible job within the budget available.

Labour Constraints
Master Builders is aware that it is becoming increasingly difficult to find skilled workers, especially in specialist areas.

We will be focusing on labour and immigration settings, to find long term mechanisms to manage the ongoing skills shortage. The solution requires a mix of training and immigration. It is great to see apprentice numbers increase over the recent boom period, our aim now is to ensure these people stay in the sector. But this only addresses one part of the issue. We also need experienced workers; this requires immigration settings which are flexible and accessible. Master Builders will continue to work with Immigration NZ and MBIE to try and alleviate some of the pressures for builders in getting the labour they need in order for their business to continue to operate effectively.

We are also working with the new Workforce Development Council for Construction and Infrastructure - Waihanga Ara Rau to ensure we have the right skills in place for the delivery of future sector needs.