Construction records first positive reading this year: Australian Industry Group

There are positive signs for the construction sector with a private reading showing increases in activity for the first time this year.

The Australian Industry Group's Performance of Construction Index rose above the crucial 50-point level separating expansion from contraction in June.

The index hit 51.8 in the month - the highest reading since November last year.

The Australian Industry Group's director of public policy Peter Burn says the rebound in activity was evidenced by an increase in new orders and deliveries from suppliers.

"The Australian construction sector closed off the financial year on a positive note by lifting back into growth following five slow months," he said.

However, it seems employers are still reluctant to take on new workers.

AI Group says, in spite of the growth, employment contracted for the seventh month is a row, indicating the operating environment remains tough.

There is a clear shift away from a reliance on mining related activity emerging as the eastern states start to lead the charge.

"New orders in the engineering construction sub-sector continued to fall and, with the mining construction boom now winding down, the outlook for this sub-sector is for ongoing weakness," Mr Burn said.

"In contrast, and suggesting further rebalancing within the construction sector, new orders grew at a faster pace for both housing and apartment building."

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Construction records first positive reading this year: Australian Industry Group