Construction Is Leading the Pack
- Tim Goode
- 11 minutes ago
- 3 min read
Good news, builders, the numbers are in, and construction is absolutely smashing it.
The latest Xero Small Business Insights data for July 2026 confirms what you've probably sensed on the ground: while other industries are doing it tough, construction remains one of the strongest performers in the Australian economy.
Let's break down what this means for you and your business.
Construction: A Standout Performer
Here's the headline you'll want to share at your next site meeting:
Construction sales are up 10.8% year-on-year.
That puts our industry in the top three performers nationally, alongside mining (+11.8%) and utilities (+13.8%). While retail, hospitality, and other sectors are feeling the pinch from rising costs and cautious consumers, construction continues to power ahead.
Why? Because Australia still needs to build. Housing demand isn't going anywhere. Infrastructure projects are rolling out. And quality tradies who know their stuff are in demand.
Jobs and Wages: More Good News
It's not just sales; construction is also leading the way on jobs and wages.
Jobs growth in construction: +5.7% year-on-year (one of the highest across all industries)
Wage growth for construction workers: +3.1% year-on-year (the strongest of any sector)
Compare that to hospitality, which is actually going backwards in terms of jobs (-0.9%). Our industry is creating opportunities and paying people well to do good work.
If you've been thinking about taking on an apprentice or adding to your crew, the conditions are right. Just make sure your cash flow can support it, which brings us to the next point.
Cash Flow Is Improving
Here's something every builder loves to hear: people are paying faster.
The average time to get paid after sending an invoice has dropped to 22.9 days, down from 24.2 days last quarter. Late payments have also improved; invoices are now paid just 6.0 days late on average, compared to 6.9 days in March.
Now, we know some of this is seasonal (everyone scrambles to sort their accounts at EOFY), but it's still a positive trend worth noting.
Our advice? Don't let this good news make you complacent. Keep your invoicing tight, follow up consistently, and make sure your payment terms are crystal clear in every contract. The businesses that stay on top of their cash flow are the ones that grow sustainably.
The Challenges to Watch
We're not going to sugarcoat it; there are still headwinds to be aware of.
Fuel prices are up thanks to global supply issues, and that flows through to everything from running your ute to transporting materials. Interest rates are holding steady at 4.35%, which means borrowing costs aren't coming down anytime soon.
The Reserve Bank is playing it cautiously, and the OECD is forecasting modest GDP growth of around 1.9% for 2026. It's not a recession, but it's not a boom either.
What does this mean for you? Keep an eye on your costs. Make sure your quotes account for rising input prices. And don't overextend; grow smart, not just fast.
Regional Snapshot: Where's the Action?
Wondering how your patch is performing? Here's the state-by-state breakdown:
Region | Year-on-Year Growth |
Northern Territory | +8.4% |
Queensland | +8.2% |
NSW | +6.1% |
Victoria | +5.3% |
ACT | +3.4% |
Queensland and the NT are firing, likely boosted by mining activity and infrastructure investment. NSW and Victoria are steadier but still solid. If you're based in these regions, there's plenty of work out there; the key is making sure you're profitable on every job, not just busy.
The Bottom Line
Construction is in a strong position right now. Sales are up, jobs are growing, wages are solid, and payment times are improving. That's a combination most industries would kill for.
But here's the thing: the businesses that make the most of good times are the ones that stay disciplined. Know your margins. Watch your cash flow. Price your work properly. And keep your books in order so you can see exactly where you stand.
The construction industry is thriving. Let's make sure your business is too.
Tim Goode
Managing Director
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