Total construction work in Australia declined 2.1% quarter-on-quarter to AUD 82,515.9 million in Q2 2026, reversing an upwardly revised 4.3% expansion in the previous quarter and defying market expectations for a 0.5% increase. It marked the first contraction since Q3 2025, driven largely by a sharp downturn in engineering work, which fell 6.0% after surging 7.4% in Q1, to AUD 36,672.2 million. Meanwhile, building construction growth eased to 1.3% from 1.7%, reaching AUD 45,843.7 million. Non-residential building slowed sharply, rising just 0.5% after a 3.4% gain in the prior quarter, although residential construction accelerated to 1.7% from 0.6%. Regionally, activity fell sharply in Western Australia (-19.7%), followed by Tasmania (-9.5%) and the Australian Capital Territory (-8.8%). In contrast, construction output expanded in Victoria (5.8%), Northern Territory (2.7%), South Australia (1.6%), New South Wales (1.4%), and Queensland (1.1%).