Construction skills required for net zero transition

While there is a large focus on the transition away from burning fossil fuels and adoption of renewables, the nation has over ten million households who are also being asked to contribute to these goals. This is changing the way that households live and use their homes, which is impacting the way we build and the types of things that clients ask for.

The shift in household preferences towards greater energy efficiency is not new. There has been incremental adoption of new energy efficient technology as it has entered the market. To achieve the net zero targe, governments are seeking to accelerate the take-up dramatically!

Accelerating the take-up will inevitably have an impact on the supply chain. The supply of skilled workers in sufficient numbers to meet demand has been identified as a major bottleneck. Efforts are currently underway to plan for the workforce that will be required to enable the least disruptive path to net zero.

The Government’s spin department has sought sell the transition to net zero as the emergence of a new industry that will create new and exciting jobs. The reality is that most of the work be done by workers is in occupations that already exist, largely using their existing skillsets.

Some new skills and knowledge will be required as existing skills are applied to new technology. However, this isn’t dramatically different to the way that the capability of the workforce evolves over time to meet the needs of the market.

There is likely to be much greater demand for electrical trades as households are increasingly forced into electrification. Governments in some jurisdictions are seeking to accelerate household electrification by committing to policies that will phase out supply of natural gas.

This raises another issue: what will become of gasfitters? Will there be enough work for the existing workers, if so for how long? Do we still need to train new workers or do existing workers in the industry need to be considering alternative employment options?

There will be significant demand for construction skills as renewable power generation projects are built to replace the coal-fired power plants which will progressively be decommissioned. The transition to renewable power generation is amongst the top priorities for government. Therefore, there is a willingness to ensure that labour constraints do not hinder their progress.

The government has already begun incentivising apprentices to work in these projects via the New Energy Apprenticeships Program which provides an extra $10,000 to an apprentice throughout their training. This incentive makes the market to attract trade apprentices more competitive, particularly in the regions where renewable projects are being built.

When a new apprentice looking to start a career in construction is faced with the option of working for an employer in the housing industry, or contractor building a renewable energy project which means they receive an extra $10,000 from the government, it isn’t a level playing field. The housing industry needs more skilled trades workers.

Furthermore, when households are being asked to improve the energy efficiency of existing homes and new homes are required to meet higher energy efficiency standards, it is illogical for the government to be luring workers away from the sector that provides this service.

With labour cost being a significant component of the costs of improving energy efficiency of existing homes and building new homes, policy measures which leave the housing industry short of workers only increases the cost of improving energy efficiency borne by households.

At a time when the rising cost of living is a major concern to the community, higher costs will see fewer households voluntarily making these changes. If the government is adamant that households need to improve the energy efficiency of their homes to assist achieve net-zero then they should be focused on how they can maximise uptake.

Maximising an improvement in energy efficiency of Australia’s 10 million homes will only be achieved if it is affordable to do so. Ensuring that there are enough skilled workers working in the housing industry will go a long way to making sure that energy efficient homes can be supplied affordably.

Apprentice support measures should be designed in a way that lifts the total number of workers in the construction industry, not simply redirecting them from one sector of construction to another.

The above is intended to provide general information in summary form. The content does not constitute specific advice and should not be relied upon as such. Formal advice should be sought by members and customers with respect to particular matters before taking action.