If you’ve tried to book a trade or driven past roadworks recently, you already know the story: Perth is under construction. The headline isn’t just that we’re building; it’s the sheer pressure the industry is under to keep up.
As we head towards the end of 2025, the Western Australian construction sector is in a unique position. It is simultaneously breaking records for activity while battling one of the hardest labor markets in history.
Here’s what’s really happening in the construction industry:
Statistics for late 2025
Despite nationwide economic uncertainty, WA is currently outperforming the rest of the nation in getting roofs over heads.
- Record completions: Between the 2024 – 2025 fiscal year, WA builders completed more than 22000 new homes, representing a massive 25.1% increase year-on-year according to statistics from wa.gov.au. This means Western Australia has the strongest growth rate of any state in Australia.
- Workforce size: According to jobandskills.gov.au, as of August 2025, the construction workforce in WA stands at roughly 155,500 people which is a good increase of 3.4% from the previous year. This further shows how critical the construction industry is to the economy and job market in Western Australia.
- The gap: Due to the demand for infrastructure and housing projects, Master Builders WA estimates an additional 55,000 workers is needed to complete projects on time. This further shows how there is growth within the construction industry, but companies are struggling to keep up, and the shortage of skilled workers isn’t making the process any easier.
The Cost of Building
For many building projects in Perth, construction costs have surged significantly. Master Building Inspectors have estimated costs to have increase by approximately 30% over the last 18 months.
In 2023/24 the construction industry faced similar challenges with significant rises in material costs. Now, the main driver is labor costs. With the mining sector also expanding its workforce by 4.2% this year, construction firms are in a bidding war for talent.
Some builders are still struggling
It seems contradictory, but in the middle of a boom, some building companies are still having a hard time to survive. In the 12 months leading up to March 2025, over 2600 construction firms entered insolvency nationally according to Peninsula Group Limited.
Many builders were locked into fixed price contracts signed two years ago. They are building houses today at 2025 prices while getting paid 2023 rates. With increased labor shortages and costs, naturally these builders will struggle to turn a profit.
A closer look at the job market
The job market is firmly in a shortage. It’s not just for bricklayers, but across the board. Electricians, heavy diesel mechanics, and civil engineers are all in high demand now.
Wages are rising with the Wage Price Index (WPI) for the September 2025 quarter showing a steady rise, meaning that qualified workers in Perth hold more bargaining power than before.
The mining industry remains the biggest competitor. With mining employment sitting at 155,900 (almost identical to construction’s 155,500). The competition for skilled workers is keeping wages high and supply low.
What’s being built in Perth
The housing industry is booming; there is big demand. However, it’s not just residential estates like those in Alkimos and Baldivis. The government’s infrastructure pipeline is keeping the civil sector running hot.
- New Women and Babies Hospital: There is a massive, multi-year project at the Murdoch Health Precinct that will dominate the commercial construction landscape until 2029.
- Recreation & Community: Recently, a contractor was appointed for a $145 million recreational facility in Perth’s north-east.
- Metronet: The projects are maturing, with several lines moving from heavy civils to station fit outs, shifting the demand from earthmovers to finishing trades.
In closing
The Perth construction industry in late 2025 is a powerful engine running slightly over the redline. The boom is real, but it’s not easy. As we head into 2026, the biggest challenge won’t be finding the work but be finding the hands to do it.
At IQ Construction we are dedicated to building high quality custom home and commercial projects in Perth. No matter the challenge, we aim to deliver project on time and in budget!
Contact us for your next construction project today.
Call us on: (08) 9399 6715