Pestle Analysis of Australian Construction Industry

The success of any construction industry can be judged by pestle analysis. To flourish the business the company needs to make self-analysis. Because it can make sure the growth with pestle analysis very easily. In pestle analysis, political, economical, social, technological, environmental, and legal factors affecting the industry are covered.

The construction industry in Australia is a big industry. As you know construction takes a long time and high cost which is a big deal in this field. The company has to perform their work efficiently and up to the satisfaction of the buyer.

Delays create many issues in any project as they are time-bound. The construction company needs to keep cutting its expense to reduce the cost of construction. As we know the increased cost is going to affect the business.

Pestle  analysis of the Australian construction industry

Political factors affecting Australian construction business:

Australia Is a constitutional monarchy. As the Queen of Australia is the queen of Britain. The queen is only a figurehead. The Governor represents the Queen at the state level, whereas the governor-general represents her at the federal level.
The prime minister is head of the Australian government.

The government policies have a great impact on the construction business. As the government schemes and subsidies are very important for the construction business.

The political environment highly affects the business in the nation. Since Australia has a stable political and business environment is a multilingual and well-educated people. As a result hey provide a sophisticated market and good environment for the companies to work.

Economical factors affecting construction  in Australia:

Rental property is preferred as compared to owned property. Since the prices are high in construction. As there is a high demand for a rental property they rent is firmly set at a higher price. The people prefer to buy constructions for rental purposes and that is a profitable business.

The population is increasing day by day. Which is giving rise a high demand for housing. For that matter, the companies have a  price hike because it will contribute profit.

The Covid-19 has contributed to a decline in new construction. There is a decline in revenue growth has reduced 1.7 % over five years and 7.9% in the current year. That is causing a high recession.

The apartment construction business is at an increasing level. Whereas commercial Complexes are not in demand these days. Because of the demand for housing construction, there is an increase in the profit margins of construction companies.

Social factors affecting construction in Australia:

There are three main classes are there in Australian society. The working class, the middle class, and upper class but this division is not a boundary between these groups.

Around 5 to 10% of the people are the wealthy or upper class. They control the property and capital of the country. The upper-class people can afford expensive homes.

The middle class is the people who are in the office sitting jobs. These professionals are in the occupation of computing specialists, engineers, accountants and medical doctors. The middle-class people also buy properties according to fashion choices and particularly to some extent.

The third is the lower class involved in manual work. They are about 20 to 40 % of the total population.

Technological factors affecting construction business in Australia:

New technological innovation creates new processes for the construction business. Technology can reduce the cost of construction. This development can benefit the customer as well and the construction company. The latest technology can provide the customer with advanced features in their construction. It helps to make good quality products and at the same, it reduces the time of construction.

Legal factors affecting construction in Australia:

In Australia, legal documents need not be written on paper. The contract may be prepared by the exchange of emails or by subscribing dockets or even verbal exchanges can be done to make a contract for the business.

The companies should ensure that they have checked the documents of their partners and buyers. They should be aware of that scam operation working in the market. So the contracted background must be checked. Professional legal advice must be taken before a contract by specialized organizations.

Environmental factor affecting construction in Australia:

Environmental factors are the weather and climate of a country. Temperature changes can affect different industries. It includes construction farming, tourism, and insurance, etc. Many climate changes are occurring due to global warming. The desire to protect the environment is growing day by day.

Environmental protection has become a priority for industries. It is true even with the construction industry. They prefer to prepare environment-friendly houses and buildings. The Environment protection act was established in 1974.


The construction industry in Australia always a chance to grow. As the new technologies have given high growth in the construction business.

Track record of Australian company feature, material, plans should be checked by a highly skilled and experienced team of professionals. Australian companies are easy to access for their services. At the same time, one should be aware of the policies of the government as well. There always have an eye on scams and fraud.

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