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Construction workforce demographics
Key findings

Understanding the demographics and dynamics of a construction workforce can assist with detailing historic success and challenges when attempting to progress into a diverse and inclusive workforce. The global financial crisis in 2008 presented the construction sector with a challenge, resulting in the workforce decreasing in size. The demographics of this workforce changed as a result, specifically with the age demographics. The older workers were more resilient to this recession while younger individuals were less likely to join the workforce and/or leave the construction sector. In addition, the source for new entrants into construction switched away from tertiary students towards career changers. Despite all this, the proportion of women in the construction industry has stayed stable since 2003, with an increase in the proportion of women as new entrants.

Introduction

The construction sector, by nature, is exposed to sudden changes in demand for work. The construction workforce, as a result, changes in size with these shocks. The key example if the global financial crisis in 2008. This demonstrated an overall decrease in the workforce size, followed by a recovery period. This report demonstrates the changes to the demographics of the workforce due to this change. This can assist with providing insight into how best to manage a changing workforce with the goal of increasing diversity and inclusivity.

Note that while employee data is complete for 2018 some employers will be missing in 2018 due to incomplete business tax records in the IDI.

Workforce over time

The chart below demonstrates how the number of workers in the construction sector has changed over time. It can be broken down by industry, region, Territory Local Authority and workforce status.

The size of the construction workforce appears to grow in correlation with economic conditions. It can be observed that there was a decrease in the size of the workforce from 2008 to 2010, due to the global financial crisis. The workforce then continued to grow. Note that 2018 has incomplete data so is not an accurate representation of the workforce that year.

The global financial crisis caused a decrease in the overall workforce. It was observed that the number of existing workers only dropped 4% (7,000 fewer workers), while new entrants dropped 35% (12,400 fewer new entrants). This suggests that during recessions, construction businesses freeze hiring new staff to minimise the impact on current staff.

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Methodology

Our workforce is defined as the number of individuals who work full time in an industry for at least three months in a calendar year. These individuals are then linked to the region they spend the most time living in during that year.

Existing workforce are individuals who worked in the same industry the previous calendar year. New entrants are workers in their first year working in that industry. Returning workers are workers who have some work experience in the industry, but were not working in the industry the previous year.

Gender

This section breaks down the workforce by gender. In 2017, 15% of the construction workforce were women, which has been consistent since 2003. However, the proportion of new entrants that are women has been fluctuating between 16-18%.

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Methodology

Our workforce is defined as the number of individuals who work full time in an industry for at least three months in a calendar year. These individuals are then linked to the region they spend the most time living in during that year.

Existing workforce are individuals who worked in the same industry the previous calendar year. New entrants are workers in their first year working in that industry. Returning workers are workers who have some work experience in the industry, but were not working in the industry the previous year.

Age

This section breaks down the construction workforce by age groups. It can be observed that the proportion of workers that are of retirement age has grown from 2% in 2003 to 5% in 2017, with the absolute number increasing four-fold from 2,900 workers to 11,400.

After the global financial crisis in 2008, it was noted that older workers had higher job security in the construction industry. There was a significant drop in the number of workers aged 15 to 24, which has only just recovered in 2017 to pre-global financial crisis levels. This was largely due to the hiring freeze, particularly with young workers. This contributed to the increase in the proportion of workers in the 25 to 34 age group from 20% in 2009 to 25% in 2017.

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Methodology

Age is calculated as the difference in years between the calendar year worked, and birth year.

Our workforce is defined as the number of individuals who work full time in an industry for at least three months in a calendar year. These individuals are then linked to the region they spend the most time living in during that year.

Existing workforce are individuals who worked in the same industry the previous calendar year. New entrants are workers in their first year working in that industry. Returning workers are workers who have some work experience in the industry, but were not working in the industry the previous year.

Ethnicity

The most noticeable trend in construction worker ethnicity is the increase in the number of Asian workers. However, this increase is mostly concentrated in Auckland and Canterbury. The significant increase in Canterbury was likely due to the spike in demand for workers after the 2011 earthquakes. In Auckland, the number of Asian workers has doubled over a four-year period from 7,000 in 2013 to 15,000 in 2017, again, likely due to the significant increase in demand for construction workers.

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Methodology

Ethnicity is taken from StatsNZ's sourced ranked list (which takes individuals census result first, in the absence of the census result it takes the next most reliable government source of ethnicity) and is summarized down into one ethnicity in the order of Maori, Pacific, Asian, MELAA, European, Other. Such that an individual identifying as both Maori and European will only be counted once as Maori.

Our workforce is defined as the number of individuals who work full time in an industry for at least three months in a calendar year. These individuals are then linked to the region they spend the most time living in during that year.

Existing workforce are individuals who worked in the same industry the previous calendar year. New entrants are workers in their first year working in that industry. Returning workers are workers who have some work experience in the industry, but were not working in the industry the previous year.

Source of new workers

The primary activity of new entrants before entering the construction sector is represented in the chart below. It can be observed that career changers make up the majority of new and returning workers to the construction sector. The proportion of each source for new entrants stayed mostly the same after the global financial crisis, except for tertiary students which saw a decrease and career changers which saw an increase. Note that the data on secondary school students is only reliable from 2007 onwards.

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Methodology

New and returning workers 'source' is defined as the workers primary activity in the year leading up to starting, or returning to work in an industry. Activities are ranked in the order of, Secondary school, Tertiary study, Career changers (work in other industries), Migrants (holding work or student visa), Returning kiwi (lived overseas for at least 6 months in the last year), Beneficiary (any beneficiary income). Such that an individual who worked in another industry and received beneficiary payments in the last year will only be recorded once and as a career changer.

Our workforce is defined as the number of individuals who work full time in an industry for at least three months in a calendar year. These individuals are then linked to the region they spend the most time living in during that year.

Existing workforce are individuals who worked in the same industry the previous calendar year. New entrants are workers in their first year working in that industry. Returning workers are workers who have some work experience in the industry, but were not working in the industry the previous year.

Disclaimer

Access to the anonymised data used in this study was provided by Statistics New Zealand in accordance with security and confidentiality provisions of the Statistics Act 1975, and secrecy provisions of the Tax Administration Act 1994. The findings are not Official Statistics. The results in this paper are the work of the authors, not Statistics NZ, and have been confidentialised to protect individuals, households, businesses, and other organisations from identification. Read our full disclaimer here.

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