Minister Tudge right on immigration. Forest industries urge new housing stimulus to help counter massive demand drop.
The Chief Executive Officer of the Australian Forest Products Association (AFPA) Ross Hampton has congratulated Australia’s Minister for Population, Cities and Urban Infrastructure, the Hon Alan Tudge, following his acknowledgement that a massive drop off in immigration will need additional policies to drive productivity and participation in Australia’s economy in response.
Mr Tudge’s comments follow Treasury forecasts which reveal the Government is estimating an 85 per cent reduction in immigration numbers over the next financial year due to the necessary closure of Australia’s borders to battle the CoVid-19 pandemic.
The minister told Radio National Breakfast program this morning, “That does have economic consequences when you do have slower population growth and that means that we will have to work additionally hard in lifting productivity and participation to make up for that slower population growth. That’s what the Prime Minister has been talking about. That every policy has to be geared towards boosting that productivity and really getting the economy growing more strongly.”
The immigration forecasts are very bad news for the housing and construction sector, which is a key driver of jobs and economic activity in Australia.
Australia’s softwood sawmills, which supply much of the timber used in new house framing, recently flagged an impending crisis as new home orders begin to drop dramatically, and nervous consumers walk away from builds. Now they are having to factor in further reduced demand as immigration is all but ended for at least the next year.
Mr Hampton said, “Our sawmills are the canary in the coalmine when it comes to new housing. The order books are emptying. The mills are now expected a 50% plus drop off in timber demand by Christmas with devastating consequences for the 45,000 regional Australians who work in the softwood timber sector. On top of those job numbers we mustn’t forget the 40,000 workers who use that processed timber to create truss, frame and other timber building products for our builders around Australia.”
“Net migration has made up over half of our annual population growth over the last decade and is a vital driver of new home construction. With that key element missing even more effort will have to be put into encouraging Australians back into the new home market.”
“It is very good that the Federal Government clearly has this coming crisis in mind. State governments will also need to partner with the Federal Government to address this important issue. Our industry will continue to advocate for a broad construction stimulus package, such as that which followed the global financial crisis,” Mr Hampton concluded.
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