In Chinese Astrology 2026 will be the year of the Fire Horse. It is viewed as a year of optimism and opportunity as the horse represents vitality, perseverance and success . So what could this mean for the construction industry? As a self proclaimed industry optimist, here are my positive predictions for the year ahead.
Industry Culture
The attractiveness of the construction industry as a place to work is inextricably linked to its culture. With recent surveys showing that high numbers of people are considering leaving the industry it is clear that the culture needs to be improved, but how do we do this?
The Culture in Construction taskforce identified three key focus areas of worker wellbeing, worker time for life and diversity/inclusion of the workforce and developed a culture standard to drive improvements in these three areas. The standard was finalised and published in August last year and has already been incorporated into procurement processes by some government delivery agencies. Expect uptake of the standard to increase during the year, including by key private sector clients.
Another key element of industry culture is the behaviour of the people that work in it, especially in terms of how they interact with each other. In 2026, this will be a focus for the National Construction industry Forum. Expect to see a draft industry charter or accord, focused on improving behaviours, published towards the end of the year.
Industry Capability And Capacity
There is some conjecture about the ability of the industry to deliver everything it is being asked to construct. In its recent market capacity report, Infrastructure Australia identified a current industry shortfall of 200k people but at a macro level this appears at odds with a situation where contractors and designers are making significant redundancies.
The devil is always in the detail, particularly for an industry the size and breadth of construction. What is clear however is that the size of the construction pipeline continues to increase whilst the available workforce is declining due to issues such as poor culture (see above) and the demographic time bomb that is effecting all industries, where the proportion of older to younger people in developed countries increases over time.
One way to address any shortfall is through skilled migration. Long favoured as the solution for plugging skills gaps in Australia, the social license for migration has reduced significantly in recent years and, as a result, is likely to become a focus of significant political debate (rancor) in 2026 but I predict that this will have some positive outcomes. It will force government and industry to look at improving training and development within the industry, particularly in respect of apprenticeships. This could in turn lead to increased cooperation between government, industry and unions. It will also shine a spotlight on the continued poor levels of female participation in the industry and the need to increase efforts to improve industry culture. Finally, it will also highlight the need to do more to improve industry productivity.
Industry Productivity
After so many years of talking about the problem of low / non existent productivity growth in the construction industry, 2026 will be the year that a number of initiatives will be implemented to achieve tangible change.
The National Construction Strategy to improve industry productivity will be finalised and implemented. Initially focused on construction of land transport infrastructure and developed by the Commonwealth and State Governments in partnership with Australian Constructors Association (ACA) , the strategy will provide a blueprint for improvements in other sectors as well and provide a platform for wider industry engagement.
Separately, the Construction Industry Leadership forum will seek to identify ways to improve how projects are designed and designs reviewed to improve the efficiency of the process, save time and improve design innovation.
In terms of blue collar productivity, agreement will be reached on increasing flexibility of when Rostered Days Off are taken (avoiding site closures and providing improved outcomes for workers) and improved management / reduction of worker down time.
Industrial Relations
2026 will see the CFMEU administrator increasingly focus on longer term reforms of the union, including how the union negotiates enterprise agreements. This will be important as negotiations to replace expiring current agreements will commence towards the end of the year. The focus is likely to move away from state based pattern agreements to true enterprise or project agreements, possibly starting with an agreement that covers work undertaken for the 2032 Brisbane Olympics.
Staying in Queensland, the CFMEU Commission of Inquiry will report in 2026. Its findings will likely shine an unfavourable light on the level of union influence on previous government policy and decision making in respect of the construction industry. This will be a good thing if it results in recommendations being implemented that prevent it happening again.
Industry Sustainability
There is growing acknowledgment that a focus on lowest price the tender box rarely delivers the best project outcomes and perpetuates a race to the bottom that detrimentally impacts the industry more broadly. In 2026 we will see an increased focus on driving broader value for money. The Construction Industry Leadership forum will consider the elements that make a project value for money and how best to measure them. These ideas will be taken forward to the Foundations and Frontiers construction forum in Sydney on 20 August.
Artificial Intelligence
2026 will be the year that AI is used to connect the multitude of data puddles that exists at a project, enterprise and industry level to create a much bigger data lake. Analysis of this data will provide valuable and surprising insights that will enable significant productivity improvements across the construction life cycle. Daily costing (ability to analyze actual cost versus budget cost for the previous day’s activities) …long a dream of quantity surveyors like myself…..will finally become a reality.
What are your thoughts on these predictions and for the year ahead…..are you glass half empty or glass half full?