THE $450 million revamp of Cairns Base Hospital is expected to generate an extra 4800 jobs during the construction phase and give the Far Northern economy a timely shot in the arm.

Work is expected to start in early 2009 and continue for five years in a major expansion of the hospital that will deliver a new block and increase capacity to 540 beds.

Industry figures said the massive project came at the right time after a recent slowdown.

"This certainly will be a spike for our economy," Urban Development Institute of Australia Cairns branch president Mathew Byrne told The Cairns Post.

"For construction especially, we’re looking at a boost."

In a surprise announcement on Tuesday, the State Government said it would sell the Cairns airport to fund the hospital redevelopment and the purchase of a large tract of land on the city’s south for a future new hospital.

Premier Anna Bligh committed to building a new facility but said it would likely not be needed for 15 years unless demand meant it would have to be brought
forward.

The building industry yesterday predicted a jobs boon for the Far North’s construction industry which has been hit by a spate of redundancies and restructuring by companies including CEC.

Economist Bill Cummings said the hospital revamp would generate at least 2400 jobs directly related to construction and building, with at least that number again employed in the service industry as a flow-on effect.

"This will help the construction industry run at a higher level," he said.

Mr Byrne said the recent decline meant many sub-contractors were looking for work.

"For the first time in a long time I have builders and sub contractors coming to me asking for jobs – not the other way around," he said.

"The sub-contract market has been stretched before, but not
currently.

"A lot of them have been shelved because of a slowing down, so this is good for tradies."

The State Government is yet to begin the tender process.

As part of the project, the long-mooted Block D will be built on the site of the existing car park.

A dedicated day surgery unit and expanded services for heart, elderly and cancer patients will also be added.

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