The Association of Consulting Architects’ final “pulse check” survey of 2020 has found around $10 billion worth of work has been cancelled or delayed and architects don’t expect the federal budget to help.
The survey generated responses from 511 practice that represent 5,600 full time equivalent technical staff.
The practices reported a total of $4 billion in cancelled work and $6 billion in delayed work. However, 43 percent of respondents have had projects restart and another 17 percent anticipate projects to restart soon. One-third of practices have had no cancellations.
A small number of practices have had a “worryingly high proportion of projects cancelled or delayed” and 20 percent of respondents face immediate work shortages.
The pattern of delays and cancellations in Victoria is similar to nationwide trends: the private residential, commercial and multi-residential sectors have had high proportions of delayed or cancelled work.
More than two-thirds of practices have experienced losses in revenue, with some experiencing as much as a 60 percent decline. In Melbourne, 80 percent of practices have experienced losses in revenue.
The survey also found that 529 employees have had hours reduced, 109 have been stood down and 97 employees have been made redundant. Of contract workers, 82 have been stood down or had their hours reduced.
More than 80 percent of practices reported that Job Keeper had prevented staff redundancies and stand downs.
However, respondents also expressed concern that some firms may be using Job Keeper to undercut the fees of others.
“One wonders if JobKeeper has artificially allowed architects to reduce fees to win jobs with extremely low quotes. If so architects have cut each others necks,” one responded.
Another said, “We have heard that some practices are deliberately not billing to make sure they are under 30 percent compared to previous year’s income to stay on JobKeeper. We have also heard that these practices are factoring JobKeeper when submitting fees and significantly undercutting their fees to win work. A dangerous practice that will lower client expectations of our value in the long term. We have lost several jobs recently where the winning architect was less than half the fee of the other architects. It looks like JobKeeper has created an uneven playing field to the detriment of the profession.”
The survey also questioned practices on whether they would take advantage of measures announced in the federal budget, including the instant asset write-off, the temporary loss carry-back scheme, and the JobMaker Hiring Credit Scheme.
“Few respondents envisage definitely taking advantage of the initiatives in the budget,” the survey found. “It is clear that the JobMaker Hiring Credit scheme will not offset the impact of reduced JobKeeper and will be of little benefit to architectural practices or the people they employ.”
Source: Architecture - architectureau
