The construction sector has started the year in a low gear with work completed in the first quarter barely growing.
The value of total construction done over the quarter edged up just 0.2 per cent to $51.2 billion on a seasonally adjusted basis, to be 5 per cent higher than a year ago.
The bulk of the heavy lifting in the quarter was done by government spending with public sector construction expanding by 2.7 per cent, offsetting a 0.5 per cent contraction in the private sector.
Public sector spending is now up almost 15 per cent over the year.
While the data represents a stabilisation on the wild swings of recent quarters due to the outsized impacts of massive LNG components dropping out of calculations, it is still weaker than expected.
The value of work done in the volatile engineering sector rose by 1.5 per cent for the quarter to be 10 per cent higher over the year.
The was also a small rise in residential construction which offset a fall in non-residential building projects as activity in office blocks, retail centres and warehousing cooled.
Modest impact on GDP
Overall, the data points to the construction sector making, at best, a modest contribution to first-quarter GDP growth.
Much of the bounce in engineering spending was due to large public transport projects funded by federal and state governments starting to be rolled out.
ANZ's Daniel Gradwell said while the headline construction number for the quarter was a little below expectations, but the details of the report were solid.
"Work continues to steam ahead in the public sector, while the housing sector still has some life left," he said.
New home-building activity edged down another 0.1 per cent over the quarter, after declining through 2017.
However, home renovators got stuck into the job in the first quarter with the value of their work up 5 per cent.
Westpac's Andrew Hanlan said the data was consistent with a short-term consolidation given the recent resilience in building approvals.
"Beyond that, we expect the downturn in home-building activity to accelerate in 2019 reflecting an anticipated pullback in approvals from current elevated levels," Mr Hanlan said.
Across the states, Victoria led the way with the value of construction up 6.5 per cent, the 15th consecutive quarter of growth.
Western Australia continued its recent weakness with spending down 6.9 per cent for first three months of year.
