Confidence Holds, but Change is Inevitable: ANZ Construction Leaders Rethink Operation to stay Competitive

The fourth annual Kennards Hire Construction Confidence Check research shows industry leaders remain optimistic about growth but are proceeding with measured caution amid ongoing challenges.

SYDNEY, Aug. 11, 2025 /PRNewswire/ -- Today, Kennards Hire, Australia's largest family-owned equipment hire company, released findings from its latest Construction Confidence Check, revealing that confidence in the industry remains high across both Australia and New Zealand – even as rising costs, productivity challenges, and global pressures reshape day-to-day operations.

The findings point to a sector in transformation, one that's moving away from fixed-cost models and toward more flexible, sustainable, and circular ways of working to meet shifting expectations and maintain momentum.

Now in its fourth year in Australia – and expanding to include New Zealand for the first time – the 2025 report surveyed over 600 senior decision-makers from mid to large construction businesses. Nine in ten leaders (91%) expressed confidence in the industry's performance over the next five years. However, it comes as no surprise that economic pressures remain top of mind, as almost all (99%) respondents are either actively implementing or exploring cost-saving strategies to maintain their competitive edge.

"We're seeing an industry that's optimistic, but also realistic," said Tom Kimber, a General Manager of Sales at Kennards Hire. "Construction leaders understand that sustained growth requires transformation. While confidence in the industry remains high, so does the pressure to optimise – whether through cost reduction, tackling productivity challenges, or future-proofing their business operations. Across the board, we're seeing a clear shift toward smarter and more agile ways of working".

Delays and Inefficiencies Draining Industry Resources

Confidence may be high, but operational inefficiencies are still dragging down project delivery and profitability. Among ANZ business decision-makers who reported experiencing cost impacts from delays or reduced productivity, one in three estimate that these challenges affect an average of 15.5% of a typical construction project's total cost.

Other key contributors include:

• Lack of quality or available materials (38%)
• Time wasted managing multiple suppliers and project managers (36%)
• Lack of specialist project management expertise (35%)
• Lack of skilled labour to complete specific work tasks (35%)
• Outdated equipment (33%)

These pain points are further amplified by global pressures, with 92% of ANZ construction leaders saying they've been impacted by tariffs, shipping delays, and shifting trade regulations in the past year.

The Shift Towards Smarter, Circular Solutions

Under mounting pressure to deliver faster, leaner and more sustainable outcomes, the construction industry is moving away from traditional ownership-heavy models. In its place, more agile, circular, and on-demand approaches are emerging with businesses prioritising efficiency, flexibility, and long-term sustainability.

According to the 2025 report, the top priorities for ANZ decision-makers over the next 12 months include:

• Investing in technology (60%) to improve project visibility, planning, and delivery
• Outsourcing specialist expertise (51%) to fill capability gaps and reduce coordination overhead
• Hiring or renting equipment (36%) to boost flexibility and avoid idle assets

"The shift towards on-demand and circular models, like equipment hire is no longer just about cutting costs," said Kimber. It's a strategic response to growing demands for speed, adaptability and sustainability.

"For many businesses, owning equipment simply doesn't make sense when project timelines are tight, labour is stretched, and the pace of change is accelerating. We're also seeing a rise in outsourcing for specialist expertise – not just to fill skill gaps, but to reduce friction and keep projects moving. These operational shifts are helping businesses stay resilient in an increasingly complex environment."

Sustainability and Workforce Strategy Take Centre Stage

As regulatory and market pressures intensify, construction firms across ANZ are increasingly embedding sustainability and workforce development into the core of how they operate. Environmental, Social and Governance (ESG) priorities are gaining momentum:

• 59% said they would prioritise Green Building Council Australia and New Zealand Green Building Council certifications to validate sustainability credentials within their top 5 ESG factors they are prioritising or investing in.
• While 49% are prioritising or investing in eco-friendly tools and carbon offsetting strategies, and another 48% are shifting to sustainable building materials within their top 5 ESG factors

At the same time, workforce transformation is emerging as a critical growth lever. In a competitive labour market, long-term value is overtaking short-term perks. To attract and retain talent, ANZ decision-makers identified the following as their top 3 priority:

• Training and development programs for acquisition of new skills (65%)
• Improved work-life balance through flexible scheduling (65%)
• Career advancement opportunities within the industry (57%)

These dual priorities, sustainability and talent – are shaping a more resilient, future-focused construction industry.

Notes to the editor:The findings from the 2025 Kennards Hire Construction Confidence Check are the result of a survey conducted by YouGov from 10 – 13 June 2025. The sample comprised of 608 senior business leaders/ decision makers from construction businesses with 20+ employees in Australia (n=403) and New Zealand (n=205)

About Kennards Hire – AustraliaKennards Hire is an Australian family-owned and operated company that has been in the hire industry for more than 75 years, with over 215 sites and branches across Australia and New Zealand. Since 1948, its product range extends from general hire equipment for the home renovator and professional tradesperson to specialist equipment and heavy machinery used on some of the largest civil infrastructure and commercial construction projects in two countries. Proud member of the Family Business Association, Member of Hire & Rental Industry Australia and Hire Industry Association New Zealand and Premium Partner of Sydney Football Club. kennards.com.au

APPENDIX 1. Key Findings Australia: 2025 Kennards Hire Construction Confidence Check Survey

Stability / Confidence

• Over four in five (89%) Australian decision-makers surveyed are confident in the Australian construction industry's growth and performance over the next five years, with almost half (44%) are very confident of the strong growth.

Macro issues

• Among Australian decision-makers who reported experiencing cost impacts from delays or reduced productivity, the key contributors are:

1. Time wasted managing multiple suppliers and project managers (41%)
2. Lack of quality or available materials (39%)
3. Lack of specialist project management expertise (38%)
4. Lack of skilled labour to complete specific work tasks (35%)
5. Outdated equipment (35%)

• 91% of Australian construction leaders saying they've been impacted by tariffs, shipping delays, and shifting trade regulations in the past year.
• In the next 12 months, the top priorities from Australian decision markers in construction include:
  • Investing in technology (56%) to improve project visibility, planning, and delivery
  • Outsourcing specialist expertise (53%) to fill capability gaps and reduce coordination overhead
  • Hiring more skilled labour (46%) to boost productivity

Productivity

• Among Australian business decision-makers who reported experiencing cost impacts from delays or reduced productivity, one in three (32%) estimates that these issues affect an average of 15.5% of a typical construction project's total cost.
• Despite an overall positive outlook of Australian decision-makers surveyed, almost all (99%) say that their businesses are currently exercising caution by implementing or exploring cost-saving measure such as:
  • Investing in technology for better project management, improved efficiency and operation (42%)
  • Actively looking for competitive pricing of materials and services (40%)
  • Workforce training to enhance productivity and reduce mistakes (40%)
  • Focusing on increasing the quality of workmanship to reduce rework and warranty issues (38%)
  • Focusing on faster project completion to minimise labour and operational costs (39%)
  • Investing in innovative equipment to improve efficiency (34%).
• Australian decision-makers are more likely than New Zealander decision-makers to cite workforce training to enhance productivity and reduce mistakes (40% compared to 30%) and focusing on faster project completion to minimise labour and operational costs (39% compared to 29%) as cost-saving measures their businesses are taking or exploring.
• Australian decision-makers are more likely than their New Zealander counterparts to cite time spent on managing multiple suppliers and project managers (39% compared to 28%) as a factor leading to additional costs.

Workforce & Careers

• Australian decision makers have identified below as the top 5 priorities to attract more individuals to pursue career in construction:
  • Training and development programs for acquisition of new skills (70%)
  • Improved work-life balance through flexible scheduling (62%)
  • Career advancement opportunities within the industry (59%)
  • Competitive salaries and benefits packages (45%)
  • Diversity and inclusion initiatives to widen the talent pool (33%)

ESG

• Across the board, Australian decision-makers are embedding ESG deeper into their operations, the key priorities cited are:
  • Meeting mandatory ESG reporting requirements (12%)
  • Having project sites accredited and certified by Green Building Council of Australia (11%)
  • Getting to net zero/ Increase carbon offsetting (11%)
  • Waste management/ material recycling (10%)
  • Using "green equipment" or eco-friendly tools (8%)