This week came the latest of many stories about the problems of rising costs and labour shortages in the Australian construction industry. And while a common refrain is the need for higher migration, one of the most actuate causes of the shortages is the government’s approvals of new coal and gas mines.

When considering approving new mines or extensions of ones currently operating, governments have often trumpeted the “new” jobs that will be created as justification for approving something that is clearly bad for the climate. And while this might seem a politically viable argument in times of high unemployment, at the moment nearly 70% of businesses in the construction industry are suffering from labour shortages and the unemployment rate of construction workers is at a near-record low of 2.8%. Clearly, there is no need for “new” jobs in the construction sector.

The approvals of new coal mines or new gas mines thus not only fail the test on environmental grounds due to the significant increases in emissions such activity produces but also on economic grounds as well as they serve to make the shortages in the construction industry much more acute.

The report this week suggested that “there was a strong demand for housing [but] builders were being squeezed by soaring costs and lack of available labour”. And we know where much of that labour and cost is currently going, because we can demonstrate just how much of hog the mining sector is on construction.

In the past financial year, more money was spent on the construction of coal, gas and other minerals mines than was spent on the construction of offices, retail and wholesale buildings, aged care facilities, health care buildings, and factories combined.

Even more pertinent, given Australia’s housing crisis and the need to increase our housing stock, more was spent on the construction of those mines than was spent building all the new apartments in Australia in 2023-24.

Anyone being told by a builder that they will have to wait many months to be able to build their home can look to the government’s approvals of new mines as a major reason for the shortage of labour.

Economists like to talk about decisions in opportunity cost terms – what could have been done instead of doing what I am doing now; what is the opportunity that is missed because I am doing something? For the government, the key opportunity cost of approving mines is diverting labour and resources away from the building of roads, offices, public infrastructure and housing towards mines that ruin the economy.

That is not a good cost to pay.

Now more than ever, the government needs to stop approving new fossil fuel projects – not just because it is horrific for the climate, but because it is making it much harder for Australians to build and live in new homes.