Canada’s construction sector experienced a slight
contraction in 2023, as growth in the non-residential sector was
offset by a moderate decline in activity in the residential sector.
Despite this trend, the industry continues to perform at an
elevated level, and is poised to grow through 2033.
BuildForce Canada released its 2024–2033 Construction and
Maintenance Looking Forward national forecast today. The report
finds that activity in the residential and non-residential sectors
will chart different courses across the short term. The country’s
residential sector, which peaked in 2021 under historically low
interest-rate conditions, will contract again in 2024 before
experiencing an upward trend between 2025 and 2029 and then
stabilize toward the end of the forecast period. The initial period
of growth is driven by a rebound in the new-housing component,
which is followed in the later years by strong demand for
renovation activity. These trends combine to increase employment to
a peak of 6% above 2023 levels in 2028. Contractions in later years
leave employment 2% above 2023 levels by 2033.
Activity in the non-residential sector is projected to remain
strong across the forecast period, given the high volume of large
projects planned and underway in most regions of the country.
Engineering construction demands are projected to cycle lower in
the short term before rebounding in middle years, in line with the
schedule of planned transit projects in Ontario and British
Columbia, as well as utility projects in New Brunswick, Nova
Scotia, and British Columbia.
Meanwhile, investment in industrial, commercial, and
institutional building projects is anticipated to see a steady
upward curve through the decade. Demand is created by high levels
of investment in the construction of institutional and government
buildings, and by a rebound in commercial building construction as
the economy returns to growth. Non-residential employment is
projected to grow almost continuously across the forecast period,
reaching a peak of 7% above 2023 levels by 2033.
These numbers are based on existing known demands and do not
take into account public-sector initiatives to address housing
affordability challenges, nor the anticipated increase in demand
for construction services related to the retrofit of existing
residential, industrial, commercial, and institutional buildings to
accommodate the electrification of the economy. Both scenarios are
addressed in separate reports to be released by BuildForce at a
later date.
“Construction is a key contributor to Canada’s gross domestic
product, and an employer of approximately one out of every 13
working Canadians. Employment has increased by about 80% since
2002, and now counts about 1.5 million people,” says Sean
Strickland, Chair of BuildForce Canada. “With further growth
projected across the forecast period, the challenge before our
sector is how to manage labour force pressures.”
Although labour market conditions eased in many provinces in
2023, pressures were alleviated most in the residential sector.
Non-residential market conditions remained challenging in Prince
Edward Island, Nova Scotia, Ontario, Quebec, Manitoba, and British
Columbia.
“Market pressures may be easing in the residential sectors of
many provinces in the short term, but even this relief may be short
lived,” says Bill Ferreira, Executive Director of BuildForce
Canada. “Our outlook calls for growth to return in the residential
sector in 2025 and through the middle years of the forecast in many
regions. Coupled with the strong outlook for non-residential
construction, labour market challenges are likely to persist
throughout much of the forecast period.”
Growth forecast across most provinces into the late
2020sConstruction activity was mixed across the Atlantic
provinces in 2023. Gains in the non-residential sectors in New
Brunswick and Newfoundland and Labrador offset residential-sector
contractions created by rising interest rates. In Prince Edward
Island and Nova Scotia, however, residential contractions slightly
surpassed non-residential gains.
The outlook calls for the provinces’ respective residential
sectors to either contract or record very small gains in the near
term, before returning to growth between 2025 and 2028. Prince
Edward Island in particular is expected to report significant gains
across this period. Renovation investment levels are also projected
to increase.
Activity in the provinces’ respective non-residential sectors
will fluctuate in line with various large-scale projects such as
the refurbishment of the Mactaquac Dam in New Brunswick, a major
hydrogen project and the Bay du Nord project in Newfoundland and
Labrador, and a number of civil and health care projects. New
Brunswick, Nova Scotia, and Newfoundland and Labrador are all
expected to report employment growth across the forecast
period.
Construction activity in Quebec is expected to generally decline
across the forecast period, with the residential and
non-residential sectors charting different courses. The former will
see activity stabilize as strong growth in residential renovations
offsets contractions in new housing. The non-residential sector is
projected to rise to a peak in 2024 before experiencing moderate
reductions to 2030 as currently known major healthcare, education,
transit, manufacturing, and utilities projects are completed.
Ontario’s construction sector experienced a marginal decline in
2023 and is projected to do so again in 2024 as its residential
sector recedes from recent highs. The contractions are short lived,
however, as the sector returns to growth between 2025 and 2028, and
remains high through 2033. The non-residential sector continues to
be driven by a large inventory of major infrastructure projects and
a projected recovery in commercial-building construction. These
carry through until at least 2029. With employment projected to
reach peak levels in the residential and non-residential sectors in
2028 and 2029, many trades and occupations could experience
strained conditions.
In Manitoba, construction will be principally driven by activity
in the non-residential sector. Growth will be greatest in the
construction of industrial, commercial, and institutional
buildings, and strong output in engineering construction in later
years. Residential sector activity is projected to contract across
the forecast period, with losses greatest in the new-housing
component.
The outlook for Saskatchewan’s construction sector is dominated
by growth in the residential sector, which is projected to
strengthen between 2025 and 2028 and remain elevated to 2033. The
non-residential sector, however, is projected to see little growth
across most of the forecast period, and declines in later years as
the current inventory of known projects is completed. A younger
demographic is well positioned to replace retiring workers.
Alberta’s residential and non-residential construction sectors
are both projected to record growth across the forecast period.
Non-residential activity is anticipated to chart a steady trend up
to the end of the decade, with growth in the oil and gas sector, as
well as in engineering construction and the construction of
industrial, commercial, and institutional buildings. Meanwhile, the
residential sector is expected to cycle up in the short term before
contracting modestly in the long run.
The outlook for British Columbia’s construction sector sees
varying trends. Non-residential activity is projected to experience
a modest decline in the short term as several major projects reach
conclusion or move past peak construction activity levels.
Investment is then sustained into 2026 before work begins on a
number of major engineering construction projects that carry
through to 2029. Residential sector activity is expected to remain
unchanged in 2024 and 2025 before the market sees a moderate
up-cycle to 2029. By 2033, renovation activity is projected to
surpass new-housing construction as the key driver of residential
demands.
“With many provinces experiencing similar growth patterns across
the forecast period, it will be challenging for employers to
recruit workers from other regions or other parts of the country to
fill labour gaps,” says Warren Douglas, Vice-Chair of BuildForce
Canada. “The challenge is compounded by Canada’s aging demographic.
It’s not just that more than one-quarter million workers are
projected to retire from the construction sector over the forecast
period. It’s also that there is a smaller pool of younger workers
from which to draw their replacements. This challenge isn’t unique
to construction. That means that other sectors will also be
competing for the same smaller pool of new workers, thereby
intensifying competition.”
Diversification will be key to addressing labour
shortagesThe development of skilled tradespersons in the
construction industry takes years, and often requires participation
in a provincial apprenticeship program. Replacing retiring workers
typically requires several years of pre-planning to avoid the
creation of skills gaps.
By 2033, the industry’s overall hiring requirements are expected
to reach 351,800 due to the retirement of approximately 263,400
workers, or 21% of the current labour force, and growth in worker
demand of more than 88,000.
Based on historical trends, Canada’s construction industry is
expected to draw an estimated 266,300 first-time entrants aged 30
and younger, leaving the industry with a possible
retirement-recruitment gap of 85,500 workers. Clearly, an ongoing
commitment to apprenticeship development in both compulsory and
non-compulsory trades will be necessary to ensure there are
sufficient numbers of qualified tradespeople to sustain a skilled
labour force over the long term.
“The construction industry remains focused on building a more
diverse and inclusive labour force,” says Strickland. “The industry
has been working hard to enhance the recruitment of individuals
from groups traditionally under-represented in the construction
labour force, such as women, Indigenous People, and newcomers to
Canada. Creating greater awareness of the tremendous career
opportunities for these individuals within the construction sector
will be critical to ensuring the sector is able to meet its future
workforce needs.”
In 2023, there were approximately 210,800 women employed in
Canada’s construction industry. Of them, 28% worked directly in
on-site construction. However, as a share of the total 1.18 million
tradespeople employed in the industry, women accounted for just 5%
of the on-site construction workforce.
The Indigenous population is another under-represented group
that presents recruitment opportunities for the construction
industry. In 2021, Indigenous People accounted for 5.1% of Canada’s
construction labour force, which is a slight decline from the share
of 5.2% observed in 2016, but is notably higher than the share of
Indigenous workers represented in the overall labour force (4.1%).
As the Indigenous population is the fastest growing in Canada and
Indigenous workers seem predisposed to the pursuit of careers
within the sector, there may be scope to further increase the
recruitment of Indigenous People into the construction
workforce.
The construction industry may also leverage newcomers over the
coming decade to meet anticipated labour market requirements. Based
on current trends, Canada is expected to see elevated levels of
immigration over the forecast period. This will make newcomers a
key contributor to the industry’s labour force. In 2022, newcomers
comprised about 19% of the total construction labour force. That
figure is notably lower than the 27% share newcomers make up of the
overall labour force.
Increasing the participation rate of women, Indigenous People,
and newcomers could help Canada’s construction industry address its
future labour force needs.
BuildForce Canada is a national industry-led organization that
represents all sectors of Canada’s construction industry. Its
mandate is to support the labour market development needs of the
construction and maintenance industry. As part of these activities,
BuildForce works with key industry stakeholders, including
contractors, proponents of construction, labour providers,
governments, and training providers to identify both demand and
supply trends that will impact labour force capacity in the sector,
and supports the career searches of job seekers wanting to work in
the industry. BuildForce also leads programs and initiatives that
support workforce upskilling, workforce productivity improvements,
improvements to training modalities, human resource tools to
support the adoption of industry best practices, as well as other
value-added initiatives focused on supporting the industry’s labour
force development needs. Visit www.buildforce.ca.
This report was produced with the support and input of a variety
of construction and maintenance industry stakeholders, and was
funded in part by the Government of Canada's Sectoral Workforce
Solutions Program.
For further information, contact:
Bill FerreiraExecutive DirectorBuildForce
Canadaferreira@buildforce.ca 613-569-5552 ext. 2220
Sean StricklandChairBuildForce Canada613-236-0653
Warren DouglasVice-ChairBuildForce Canada306-352-7909