By Rhiannon Hoyle
SYDNEY--Demand for Australian infrastructure workers is showing
signs of easing as a sharp pullback in commodity prices puts a
cloud over some resources projects, recruitment managers have told
Dow Jones Newswires.
Until recently, demand for construction workers on
infrastructure developments in the Pacific nation--much of which
has been related to the booming mining sector--was "like a
tear-away freight train," said Stephen Lording, managing director
of Judd Farris Recruitment, the construction arm of Adecco Group,
one of the world's largest recruiters.
A recent drop in commodity prices and expectations the markets
may have further to fall has prompted some mining companies to
rethink aggressive plans to boost production of materials, like
coal, iron ore and copper. BHP Billiton Ltd. (BHP.AU) Chairman
Jacques Nasser said last month the company no longer plans to
invest US$80 billion by 2015, a target set just last year.
Mr. Lording said the pullback in commodities--like thermal coal,
which has dropped to its lowest level in almost two years--appears
to have shaken confidence in the industry. The price of iron ore, a
key export for the Australian economy, has slipped to US$130.60 a
metric ton, from US$147.60 a ton at the start of April.
"Discussions [when mining clients were seeking infrastructure
workers] were previously around 'growth, growth, growth.' It has
only really been over the past month that companies have started to
say 'we need to stop and look at this,'" he said.
Shane Little, regional director for Hays' (HAS.LN) New South
Wales division, and a member of the international recruitment
company's Australian construction board, said there has been "a
slowdown in the urgency" required to fill new jobs on Australia's
east coast, particularly in the NSW state.
However, Mr. Little said he's yet to see a fall in demand for
workers in Western Australia, which is home to the country's remote
but mineral-rich Pilbara region.
According to figures from the Australian Bureau of Statistics,
released Wednesday, strong mining investment helped spur a 1.3%
rise in gross domestic product in the first quarter from the
previous three-month period. Mr. Lording said demand for workers on
existing mines continues unabated.
The outlook for the Australian economy, however, remains
uncertain. The country's central bank cut interest rates by 25
basis points this week as it cautioned global shocks may start to
rattle the local economy. A sharp slowdown in China, Australia's
biggest trading partner, is seen as the primary risk for A$500
billion in mining investment proposed in Australia.
Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com