Large-scale renovation is big on job creation

The building industry is in a strong position to protect and create jobs in these tough economic times – with Government support.

Media release

EMBARGOED TILL 5PM FRIDAY, 27 February 2009

Large-scale renovation is big on job creation

The building industry is in a strong position to protect and create jobs in these tough economic times – with Government support.

Prudent investment by the Government in New Zealand’s residential infrastructure, in partnership with local government and industry, will maintain employment and critical mass in the building, building product manufacturing and building retail industries, said Beacon Pathway general manager Nick Collins in the wake of today’s Job Summit.

The summit on employment, held in South Auckland, aimed to find practical solutions to support the highest possible levels of employment as we weather the downturn.

Mr Collins said that National’s focus on upgrading state housing is an excellent leadership position which can be built on by encouraging and incentivising other home-owning New Zealanders to do the same.

“The residential sector is a large source of employment: the house building and renovation industry is worth in excess of $12.0 billion annually and directly employs about 5% of the workforce. There is significant economic and social benefit in redirecting this resource to improving the current housing stock in recessionary times,” said Mr Collins.

The numbers are compelling.

A standard 1940-1960 home renovated for improved performance would require an estimated 277 hours of labour split between a variety of sub trades. The data indicates that for every 1,000 houses retrofitted a total of 151 full-time equivalent jobs would be required for delivery solely of on-site retrofitting services; a total of 392 full-time equivalent jobs would be required to provide the products and services involved in the renovation activity.

“An initiative of this scale would also mitigate the risk of losing skilled tradespeople to offshore markets,” said Mr Collins. “The building industry is cyclical by nature; it’s vital that New Zealand retains this expertise so the industry is ready to hit the ground running when the economy recovers.”

There are several employment benefits to undertaking wide-scale renovation:

Renovation activity involves a broad spectrum of skills and trades from unskilled labour through to qualified electricians, plumbers and builders, and hence provides a diversity of employment opportunities.

The jobs and skills required by renovation activity are easily transferred into and out of new build activity – providing a flexible workforce. As the housing stock is upgraded and New Zealand lifts out of a period of recession, the developed skill-sets required for renovation can be easily retuned for the new build construction sector.

Specific regional targeting of renovation activity based on housing stock is possible – assisting communities who are in greater need of securing jobs and retaining skilled workers.

Renovation activity can utilise and target New Zealand-made products and services helping to support the wider local economy (for instance, through utilising locally-made insulation materials).

The need for an element of low skilled labour in renovation installation provides employment for many who need it most.

ENDS

Notes to editors

What follows is an explanation to information and data in the body of the release:

1. The house building and renovation industry is worth in excess of $12.0 billion annually and directly employs about 8% of the workforce.
• Source: Briefing for the Minister for Building and Construction, November 2008, p7

2. A standard 1940-1960 home
• Beacon Pathway has developed an approach to retrofitting New Zealand houses which defines a set of standard typologies in New Zealand. One of the largest groups of houses represented in this country is the 1940-1960 mass housing style. Research undertaken by BRANZ indicates that there are a total of 479,000 of these houses throughout the country.

3. Renovated for improved performance
• The majority of New Zealand houses can be readily adapted through renovation to perform to a much higher standard in terms of warmth, health, comfort, energy and water use. For the purposes of this exercise, a standard renovation package for the house has been assumed. This incorporates ceiling and underfloor insulation, ground polythene vapour barrier, wall insulation, efficient heating device, heat transfer system, solar hot water heating, low-flow water devices and low-flush toilets, rainwater tank, hot water cylinder and pipe wraps, extract fans in kitchens and bathrooms, double glazing retrofitted into existing timber window frames (or secondary glazing/thermal curtains), on-site assessment of house and project management.

4. Homes renovated for improved performance would require an estimated 277 hours of labour split between a variety of sub trades. The data indicates that for every 1,000 houses retrofitted a total of 151 full-time equivalent jobs would be required for delivery solely of on-site retrofitting services; a total of 392 full-time equivalent jobs would be required to provide the products and services involved in the renovation activity.
• Research commissioned by Beacon Pathway underpins this data. Find more information at www.beaconpathway.co.nz. The employment figures represent total numbers of full-time equivalent employees required to carry out the work. The numbers have been developed from detailed analysis of the time required to undertake the variety of renovation tasks outlined above. The standard employment multiplier of 2.6 for the industry sector is then used to account for the additional employment generated through manufacturing, retailing and servicing of retrofit interventions e.g. manufacturing and retailing insulation, solar water heating systems, extraction fans, etc.
About Beacon Pathway

Beacon Pathway Limited is a research consortium that is working to find affordable, attractive ways to make New Zealand’s homes more sustainable: warmer, healthier, cheaper to run and kinder to the environment. Beacon aims to bring about a significant improvement in the sustainability of the residential built environment in New Zealand through science-based New Zealand research.

The Foundation for Research, Science and Technology matches funding from Beacon’s shareholding partners, a unique mix of industry, local government and research organisations: BRANZ, Scion, New Zealand Steel, Waitakere City Council and Fletcher Building.

For further information about Beacon Pathway visit www.beaconpathway.co.nz.

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