Countdown's new distribution center on Alderson Dr is a major contributor to the $ 223.3 million non-residential permits issued in Manawatū 12 months prior to March, an 82 percent increase over the previous year.

WARWICK SMITH / stuff

Countdown’s new distribution center on Alderson Dr is a major contributor to the $ 223.3 million non-residential permits issued in Manawatū 12 months prior to March, an 82 percent increase over the previous year.

The construction boom in Manawatū continues to pick up speed, but with the rapid growth there is a risk that the construction industry in the region will reach its limits.

The Central Economic Development Agency’s quarterly economic update found that Manawatū had approved a record $ 223.3 million in non-residential permits in the 12 months leading up to March, an 82 percent increase over the previous year.

“Construction is moving fast and has confidence that we will work our way out of the economic slowdown,” said Peter Crawford, economic advisor to Palmerston North City Council.

However, the ongoing shortage of labor and supplies meant the busy construction industry in Manawat struggled to keep up with demand.

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Most of the contributors to the record were $ 88 million worth of warehouse buildings approved in Palmerston North as the city’s logistics and distribution sectors expanded, as well as a number of high profile projects.

“The biggest project that has contributed to this increase is the new countdown distribution center, and second, the new coat hangers and other facilities [being built] in Ōhakea ahead of air force personnel relocations to the region in 2023, ”Crawford said.

Housing permits also boomed. In the first three months of the year there were 17 percent more approvals than the 174 in the first quarter of 2020.

The driving forces were townhouses and strong growth in the elderly care sector, with the number of townhouses increasing by 40 percent with approval.

Central Economic Development Agency’s talent and skills manager Sara Towers said the rapid growth is a sign of a thriving regional economy, but it continues to put pressure on the construction industry to find skilled workers.

Manawatū entered its busiest construction phase in four decades, with $ 1.5 billion in construction and development projects over 10 years beginning in 2017.

Towers said the skill shortage had been a national problem for much longer, but it wasn’t that bad in Manawatū.

“[The boom] Got us … I don’t think anyone predicted this growth [in our construction industry] before it started. “

CEDA Talent and Skills Manager Sara Towers says the rapid growth in building permits will put even more pressure on the Manawatū construction industry, which is already facing a skills shortage.

DAVID UNWIN / stuff

CEDA Talent and Skills Manager Sara Towers says the rapid growth in building permits will put even more pressure on the Manawatū construction industry, which is already facing a skills shortage.

Towers said the agency is working with industry groups like the building and construction training organization to promote recruitment and training in the trades and to attract skilled workers from other regions.

It also brokered a partnership between the National Drivers Center, Talent Central and the Central Skills Hub earlier this year to help young recruits prepare for work based on the basic skills employers said hopeful apprentices are missing.

Towers said it would take those efforts years to pay off, and some specialties like painters and rubber stoppers relied on migrant workers to fill the void.

“But these workers have been harder to come by since the international border closings.”

Palmerston North developer Brian Green said another challenge in managing high demand is supply bottlenecks.

Basics such as trusses, frames, hardware and fittings were in short supply.

Green said this was partly due to the pandemic’s disruption to international trade, but the overall problem is that most of the scarce goods are made in China – and those manufacturers are skipping shipping to New Zealand.

They could make more money by sending larger container ships to Australia and straight to America instead of using smaller ships that could stop in New Zealand ports.