The Australian Constructors Association (ACA) has released the 2025 Construction Market Sentiment Survey, revealing that collaboration is the single biggest lever to lift productivity in Australia’s construction industry.
ACA Chief Executive Officer, Jon Davies, said that the message from industry is clear.
“Almost nine in ten respondents said collaboration is the number one driver of productivity,” Davies said.
“But instead of working together, clients are falling back on outdated contracts that dump risk on contractors. Has history taught us nothing? Lump sum, hard dollar contracts that pass all risk to the contractor don’t deliver – they fuel disputes, delays and poor outcomes.”
The survey highlights that the industry’s challenges are being made worse by labour and skills shortages.
“With capacity tightening, the only way to do more with less is by working smarter together. Collaboration is no longer optional – it’s the only way to keep projects on track.”
The survey also shows a clear shift in market activity.
“Queensland is surging ahead while New South Wales and Victoria settle into a new normal of reduced transport spending. But in Queensland, tenders in the first half of 2025 have been very limited. To maintain momentum, projects need to be brought forward.”
Arcadis National Service Lead, Matthew Mackey, said that sectoral demand is also reshaping the market.
“Transport infrastructure is tapering off in NSW and Victoria, while growth is emerging in water, sewerage, energy, data centres, and social and affordable housing,” Mackey said.
“But this new demand isn’t yet strong enough to offset the decline in transport, creating challenging conditions overall.”
On costs, the survey found most material prices are stabilising, but concrete and plasterboard remain under pressure.
“The findings can’t be ignored,” Davies said.
“We have opportunities to grow, but without genuine collaboration, a steady pipeline and smarter risk-sharing, Australia’s construction industry risks falling short of delivering the infrastructure the nation needs.”
