Trades warned to prepare for tough times as construction start-ups surge

Trades warned to prepare for tough times as construction start-ups surge

Construction has emerged as a hotbed for small business start-ups in Queensland with the Gold Coast proving to be a major driver of growth.

But microbusiness owners in the building game have been warned they could face an uphill battle to survive once the building boom fades.

A new study by Construction Skills Queensland (CSQ) has found that since 2015, the state added 5,000 small construction businesses, an increase of 8 per cent.

The Gold Coast accounted for 2,000 of these start-ups, surging 17 per cent to 13,000 at more than double the state's overall growth rate.

Construction already represents the largest industry sector for small businesses in Queensland, accounting for more than 75,000 of the state's 450,000 small businesses.

"While the construction industry is a massive employer - employing 225,000 Queenslanders - two-thirds of these people work in a small business," says CSQ research director Robert Sobyra.

"More small businesses have sprung up over the last five years, and we would expect this to continue even more so off the back of the current building boom."

Sobyra says the Sunshine Coast is also a strong performer alongside the Gold Coast in Queensland, noting that the state's key lifestyle cities have proved to be a big lure for trades moving from interstate and intrastate to set up shop.

"The vast majority of our industry is supported by microbusinesses," says Sobyra.

"That's the way it's always been, providing trades with more money, flexibility and autonomy. There's a whole lifestyle element to it as well, and while they have the potential to make more money, with the rewards comes extra risk."

Sobyro warns the good times may not last.

"There is a shortage of trades right here and now because of the building boom. But I don't think that shortage will persist into 2023-24 unless we get a huge lift in population once immigration resumes.

"Structurally speaking we have enough apprentices coming through even though builders are currently feeling the pinch in terms of skilled trades and a shortage of materials.

"This will run for 18 months or two years as there is a strong pipeline of work ahead of us in the near term."

Sobyro says many who have made the transition to owning their own business are 'invariably great at their craft, but they're often not so good at running their business'.

"That's all well and good during a boom but when we come to the end of this, their risk management, contract management and control of their supplies will become very important."

The stereotype of a tradie running their own business hasn't changed much over the years.

"There are people in their 20s and 30s working or themselves, but the typical image of a male in their mid-forties with a ute and a dog isn't too far off," says Sobyro.

"Ninety per cent of Queensland's construction businesses have a staff of fewer than five people, and 60 per cent of them are working solo."

Sobyro says CSQ has taken a proactive approach to help prepare microbusiness owners in the building industry for more challenging times ahead by pouring more than $1 million into dedicated small business training programs on top of the regular courses it offers.

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