Media Release — Auckland, 16 July 2025

Builders adapting to a challenging market

The survey shows that the market remains tough; average business capacity has dropped to 64% from 67% last year, and a quarter of builders are operating at less than 50% capacity. 

Despite this, the rate of decline in demand has slowed: Net demand sentiment has improved from -55 in 2024 to -33 in 2025, and 22% of builders say demand has been up over the last 12 months — vs only 12% in 2024. Larger businesses (11–50 employees) are showing the most optimism, while sole practitioners and small businesses remain the most affected.

“While the current situation is challenging, builders do seem to be predicting improvements in the future — it may be that we are at, or nearing, the very bottom of the cycle now,” says Matthew Duder, Managing Director, EBOSS.  

Builders report that almost all aspects of managing a construction business have become more difficult over the past year, particularly maintaining profit margins and keeping the pipeline of work full. That said, the industry is learning to navigate persistent risks, with many builders now accustomed to managing project delays, cancellations, and cost pressures.

“The survey results show an industry still doing it tough. However, the ability of skilled SME builders to adapt was most impressive,” says Malcolm Fleming, Chief Executive, New Zealand Certified Builders Association. “As new home build projects dried up, our members have shifted into doing more alterations and additions, the one area of the market where demand held firm.”

“They also took on light commercial work, school projects, and flood and cyclone remediation work. It was driven by needs-must, but made possible because being trade-qualified meant they could take on more technical areas of work such as alterations and additions. That resilience has been a bright spot across this two-year downturn.”

Immediate outlook: Next 12 months remain difficult

Looking ahead, the 12-month forecast remains challenging. Nearly half (46%) of builders expect industry conditions to worsen, though this is an improvement from 69% in 2024. However 40% anticipate improvement, indicating a cautious but slightly more positive outlook than last year. 

Forward workloads have declined to an average of 8.2 months, with three in ten builders having just three months or less of work ahead. Project cancellations and holds now impact over a third of businesses, and 61% say it is now harder to keep their pipeline full compared to a year ago.

The report highlights that smaller, residential-focused businesses are particularly vulnerable, while larger and more diversified firms are better positioned to weather the downturn. 

“Cost pressures, economic uncertainty, and competition for skilled staff remain top concerns for the sector. The data confirms that the biggest competitor to NZ builders for staff is Australia, and this competition is set to intensify as Australia ramps up construction ahead of the 2032 Brisbane Olympics,” says Duder. 

Bright future for apprentices as shortage looms

Despite current difficulties, the survey points to a significant opportunity for apprentices. “The industry is urging young people and those looking for a career change to consider construction, as the sector anticipates a rapid increase in the demand for skilled workers when the market turns,” says Duder. 

24% of builders surveyed are looking to hire over the next 12 months, most often looking for qualified trades (60%) and apprentices (34%), yet 38% of respondents say there are not enough good apprentices available today. As the market recovers, this shortage in qualified trades is expected to intensify.

BCITO, the national organisation that manages builder apprenticeships echoes this sentiment; they currently have lower numbers than usual with 14,000 building professional apprentices, including 9,100 carpentry apprentices.

“The training volume is down by approximately 25% compared with the peak in 2022, which reflects an easing in construction volume over this period,” says Greg Durkin, Director of BCITO. 

This trend is also evident with sub trades. Greg Wallace, Chief Executive of Master Plumbers notes that plumbing, gasfitting and drainlaying (PGD) apprentices are down on previous years. "In 2025, enrolments for PGD have been under 400," says Wallace. "This is nowhere near where we should be, as most apprentices commenced their training at the start of the year. We estimate we will finish at year end with about 500 apprentices, which is about 50% down on previous years.” 

“We will have an industry shortage of tradespeople in 2026,” adds Wallace. “For 8 years, the construction sector was growing significantly, and the number one issue was finding available workforce. We have retracted so quickly and as the market recovers, this again will be our number one issue moving into 2026.”

A continued increase in construction and trade apprentices will be crucial for ensuring a smooth recovery for the industry. 

“Over the past two years, industry has remained committed to workplace training with employers conscious of the need to maintain high levels of productivity,” says Durkin. “Skilled staff enable businesses to thrive in times of growth and adapt to changing market conditions. This is critical to both industry and the wider economy, and businesses will need even more trained people as demand increases.”

2025 EBOSS Builder Sentiment Report Key Findings: 

Industry outlook:

• Net sentiment is at -6 for 2025 vs -46 in 2024 (percentage of those surveyed predicting a decline, minus percentage of those predicting an improvement).
• 46% of builders believe the overall condition of the industry will continue to decline over the next 12 months — an improvement from 69% in 2024
• 40% of builders believe industry conditions will improve in the next 12 months
• 63% of builders believe the economic impact will impact their business in the next 12 months
• 52% believe the cost of lending/interest rate will impact their business in the next 12 months

Demand for building work:

• Net demand is -33% 
• 22% report an increase in demand vs only 12% in 2024
• 33% of say cost pressures are having a large impact on demand, while a further 42% say they are having a moderate impact
• Capacity has decreased to 64% from 67% in 2024 and 83% in 2022
• 24% of building businesses working at 0 - 49% capacity 
• Smaller businesses are hardest hit, with sole practitioners at just 50% capacity on average

Construction pipeline:

• 36% of builders have seen an increase in the number of projects being put on hold compared to 12 months ago
• 34% have seen an increase in cancellations compared to 12 months ago
• 48% say the number of leads and enquiries is lower compared to 12 months ago

Forward workloads:

• 29% of builders say their business has just 0 - 3 months of forward work on the books
• Average forward workload is down to 8.2 months
• Larger firms have seen a steeper drop in forward work, from 16 months in 2024 to 10 - 12 months in 2025

Managing the business:

• 61% of builders report it is more difficult to keep the pipeline full compared to 12 months ago
• 61% of builders find it more challenging to maintain profit levels compared to 12 months ago

Staffing levels:

• Four in 10 building businesses lost skilled staff in the past 12 months
• 39% cite staff moving to another country such as Australia as the reason for staff leaving
• 20% cite redundancy as the reason for staff leaving
• One in six builders say they have too many staff for current and future demand
• 26% say they don’t have enough staff to meet future demand
• 35% of building businesses currently have at least one apprentice

Hiring & apprentices:

• 24% of builders are looking to hire over the next 12 months, most often looking for qualified trades (60%) and apprentices (34%)
• 75% expect to experience difficulties in finding good staff

Sustainability & Carbon:

• 42% of builders rate waste reduction as very important
• 71% of builders say cost is a higher priority than carbon

The survey of 431 New Zealand builders (including LBP Site 1, 2 or 3 Builders, LBP Carpenters, Project Managers and Other Builders), conducted by EBOSS and funded by the BRANZ Building Research Levy, is part of an annual research programme that aims to provide an update on the current and future state of industry sentiment. 

In September 2025 EBOSS will release the 2025 Architect Sentiment Report — providing an update on designer sentiment from a survey of over 500 New Zealand architects and designers.

Click here to download the 2025 Builder Sentiment Report