Australia’s building industry is being squeezed as fuel price instability drives rapid and unpredictable cost increases across projects, supply chains and labour.
David Reid Homes Managing Director Matt Jackson said the pace of change has left many businesses struggling to keep up.
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“Costs are changing by the day,” Jackson said.
“This is no longer a slow increase. It’s constant movement and it is putting enormous pressure on builders trying to deliver projects responsibly.”
Flow-on effects across every job site
Fuel costs are now influencing nearly every aspect of construction, amplifying financial pressure across the board.
“Fuel touches everything in construction,” Jackson said.
“It impacts deliveries, logistics, product costs, site visits and every trade getting to and from jobs.”
The cumulative effect is significant. “You’re not just dealing with one cost increase,” he said. “You’re dealing with multiple layers of cost increases hitting at once.”
Young tradies feeling the strain
The burden is not evenly distributed, with apprentices and younger workers among the hardest hit.
“They’re the ones driving across cities, across regions, just to get to work,” Jackson said.
“They don’t have the financial buffer, and they’re being hit the hardest.”
He warned the longer-term impact could be serious for the sector. “If we don’t support young tradies, we risk losing the next generation of skilled workers.”
Builders absorbing the pressure
Many builders are now carrying rising costs themselves in an effort to protect clients and honour contracts.
“There are a lot of good, honest builders doing the right thing, trying to deliver projects at agreed prices but when costs keep shifting, that becomes incredibly difficult,” Jackson said.
Call for transparency and accountability
With costs escalating, there are growing concerns about pricing practices across the supply chain.
“If the government is serious about cost-of-living pressures, then it needs to look closely at what’s happening across building and supply markets,” he said.
“There has to be accountability. Price gouging needs to be addressed and stopped.”
Jackson added that the consequences extend beyond the industry. “When suppliers increase prices without transparency, it doesn’t just hurt builders, it pushes up the cost of housing for everyday Australians.”
Systems become essential, not optional
In response to the volatility, David Reid Homes is rolling out improved systems to better manage shifting costs.
“In this environment, you need real-time visibility on costs, timelines and supplier pricing,” Jackson said.
“That’s how you protect your business and your clients.”
A tipping point for the sector
With fuel pressures, labour challenges and supply constraints converging, the industry is entering a critical phase.
“This is a tipping point,” Jackson said.
“The businesses that can manage costs and operate efficiently will survive. The rest will struggle. However, in the current environment, more needs to be done to ensure businesses do not engage in opportunistic gouging because it harms all of us in some way. The flow on effects are significant.”
