Engineering construction investment in Western Australia is set to increase over the next two years, driven in large part by the state's ongoing resources boom.
According to figures released today by the Construction Forecasting Council, engineering construction spending will increase by 10.4 per cent each year until the end of the 2007 financial year.
This forecast builds on the average increase of 8.7 per cent in construction spending between the 1998 and 2005 financial years'.
Engineering construction in the state will continue to be driven in large part by works on major mining, and oil and gas projects and associated infrastructure.
Interestingly, the figures predict that the average increase in engineering construction in WA will soften in the longer term (to 4.7 per cent between now and 2010).
This forecast may appear at odds with other indicators, as the state's resources boom currently shows no signs of abating.
Nationally the CFC report said that spending on engineering construction would increase by 9.3 per cent per annum over the next two years.
The ACT, which is forecast to increase construction engineering spending at 17.6 per cent per annum over the period, heads all states, followed by Queensland - 15.6 per cent per annum increase.
In the residential sector, apartment construction will continue to show strong growth in WA over the short and long term.
However, new houses and small alterations constructions in WA are predicted to post negative growth in the short term, and not recover lost ground for around eight years.
New houses in WA, in particular, are forecast to be affected with -9.6 per cent per annum growth over the coming two year period, contributing to a forecast for total residential building growth in the state of -2.5 per cent per year for the period.
ACT, Tasmania, New South Wales and the Northern Territory are also all expected to record nil or negative residential construction spending in the short term.
