Last week Shadow Workplace Relations Minister Michaelia Cash took the opportunity to resurrect a familiar Coalition argument: that construction workers’ wages are to blame for rising house prices.

It’s an easy pitch. The CFMEU are a soft target at the moment and quarter-on-quarter housing prices continue to skyrocket.

These claims are politically convenient, but the data tells a different story.

ABS data shows construction wages grew by 3.8 per cent to June 2024. In contrast, the Real Estate Institute of Australia found the national median house price rose by 7.6 per cent over the year to March 2024.

In South Australia, we just witnessed the median price of a home increase by 4.93 per cent in a quarter. The disparity between house prices and hourly rates of pay in the construction industry is obvious from the figures below:

Increasing wages only have a marginal impact on construction costs. Labour costs are just one component of an expensive industry that is particularly vulnerable to rising inflation.

The most recent ABS analysis of GDP across the construction industry attributes growing costs to an increase in the prices of building materials, fuel and energy.  These are well-established issues across many industry sectors in the wake of the pandemic and the war in Ukraine.

A skilled labour shortage has led to higher wages to attract and retain staff, and an increase in subcontractor expenses, but this is the market economy at work.

And if we look at take-home pay, Jobs and Skills Australia shows that the at $1,538 a week median income of a construction worker is lower than all industries median earnings (of $1,600).

Assuming you’re working every week – a significant assumption in a transient industry – that’s less than $80,000 a year. In contrast, the latest figures from the ABS show construction industry earnings grew by $6.1 Billion (11.6%) in the 2022-2023 financial year.

Construction industry wages have also been blamed for folding businesses but, looking locally, last week it was reported that a liquidator investigation into the recent collapse of the Felmeri Group found it was likely they had knowingly traded as insolvent, and that there had been “significant use of funds for non-business-related purposes” including $144,000 in the director’s personal expenses.

This is the sort of mismanagement that increases housing costs for homeowners.

Amongst inquiries into the allegations of corruption and organised crime links in the CFMEU – which are well underway – we must remember that the construction industry is one of the largest employers in the country and it is dangerous, dirty and difficult work.

The most recent figures from Safe Work Australia show 27 construction workers died in 2022 and there were 15,600 serious injuries across the industry in 2021-2022.

It is transient work and is hard on the body so it’s difficult to work construction into old age. According to Jobs and Skills Australia, the median age of a construction worker is 37, which is three years below the national average.

The Coalition are using this as an opportunity to demonise enterprise bargaining.

But what some commentators conveniently forget during these conversations is that – regardless of whether we’re talking about construction workers or disability support workers – industrial awards have always been intended to set a minimum entitlement. Not, as some would have you believe, the ceiling.

According to the ABS, employees paid by award wages have the lowest hourly and weekly cash earnings and work the lowest average hours per week.

Enterprise agreements also raise safety standards for all workers – union and non-union members. As such it is important to understand what entitlements we are discussing.

The industrial entitlements in CFMEU enterprise bargaining agreements include environmental safety clauses for severe weather (lightning, storms, extreme heat) and dewatering (the process of removing water from a construction site) all of which are serious safety issues if you are operating heavy machinery, for example.

They also include union approval for overtime and weekend work, permission to conduct union meetings and about 25 rostered days off a year (scheduled well in advance so as not to disrupt construction).

These are standard entitlements in blue-collar industries and hardly the burdensome demands some would have you believe.

Unethical and illegal behaviour in any sector must be addressed. But the investigation of any wrongdoing in the industry mustn’t be at the expense of workers’ safety.

We must ensure that the issues plaguing the CFMEU aren’t exploited to drive down the real wages of everyday Australian workers performing some of the toughest jobs in our country.

Dr Gemma Beale is the Executive Director SA/NT of The McKell Institute.