Government unveils $10k apprentice incentive to tackle housing shortage
The federal government has announced a major initiative to address Australia’s chronic shortage of tradies, a critical factor in increasing the nation’s housing supply.
From 1 July 2025, eligible apprentices in the residential construction sector will receive $10,000 in incentive payments under the newly introduced Key Apprentices Program.
The payments, aimed at boosting apprentice retention will be distributed in stages at 6, 12, 24, and 36-month marks, with a final payment upon completion.
Australia’s building and construction industry is under pressure to construct enough homes, commercial buildings, and infrastructure to keep up with the rising demand and growing population.
Currently, the building and construction sector apprentices receive a $5,000 payment, which is front-loaded. The payment option will remain available for those not eligible for the new program, which has been extended until the end of 2025.
The Property Council of Australia endorsed the federal government’s announcement, highlighting the initiative's potential to support the construction of 1.2 million new homes by 2029.
The announcement follows Master Builders’ recent blueprint for improving apprentice attraction and retention, signalling a commitment to strengthening the workforce in Australia’s building and construction sector.
Property Council chief executive Mike Zorbas praised the move, emphasising the urgent need to increase apprenticeship numbers to address Australia’s housing supply crisis.
“More workers on site is essential to solving the housing supply puzzle. Hopefully, this incentive will see completion rates increase,” Zorbas said.
Zorbas noted that the housing deficit, decades in the making is exacerbated by labour shortages, planning days, high property taxes, and rising construction costs.
He stressed the importance of collaborative thinking to meet the national target of 1.2 million homes.
“Government and industry have to work together over the next ten years to make it as easy as possible to invest in and build more homes,” Zorbas said.
Master Builders Australia chief executive officer Denita Wawn welcomed the initiative but urged further action to support employers and broaden the program.
“Labour shortages are currently the biggest handbrake on fixing the housing crisis,” Wawn said.
"Around 50 per cent of all apprentices do not complete their training - the new staged payments approach will hopefully see the rate of completions increase”.
“Coupled with government funding of fee free vocational education and training, there is no better time to pick up the tools and become a tradie”.
Master Builders also emphasised the need for these payments to extend to other areas of the construction industry, including infrastructure projects such as roads, rail, and sewerage, which are essential for expanding housing development.
Despite the progress, Wawn highlighted ongoing challenges for small businesses.
“We are disappointed that the high costs associated with hiring and training and apprentices has not been recognised as yet. 98 per cent of businesses in building and construction are small and they are doing it tough,” she said.
The government’s $627 million investment in the initiative is expected to encourage apprentice recruitment and retention in the targeted sectors.