CLR Connector Buildforce Canada Released it’s Five-Year Forecast for the Construction Industry

In March, BuildForce Canada released its 2022–2027 Construction and Maintenance Looking Forward national forecast. The report focuses on a six-year horizon for labour market data as opposed to the 10 years studied in previous reports.

Construction investment in both residential and non-residential sectors recovered strongly in 2021: +14% and +8% respectively. Investment is projected to remain at current high levels through 2023, before declining gradually over the remainder of the forecast period.

The rise in construction activity in 2021 lifted employment to approximately 1.1 million workers. That number is a 7% increase over 2020 levels and a 1% rise over pre-pandemic figures recorded in 2019. The surge in construction activity is expected to boost employment further to a peak in 2022, before diverging trends take hold thereafter. By 2027, employment is expected to expand by nearly 16,000 workers, or about 1% above 2021 levels.

Closing Construction’s Skills Gap

BuildForce Canada Executive Director Bill Ferreira reported that though the construction sector “has rebounded well from the effects of the COVID-19 pandemic”, the challenge facing the industry is how to manage its labour force. Retirements are expected to reach their highest levels over the next two years, with approximately 156,000 workers exiting the industry.

That, combined with growth in worker demand of nearly 16,000, will result in hiring requirements reaching 172,000 workers by 2027.

Based on historical trends, Canada’s construction industry is expected to draw an estimated 143,000 first-time entrants aged 30 and younger from the local population, leaving the industry with a possible retirement-recruitment gap of 13,000 workers. When coupled with demand growth, the industry may be facing a shortage of 29,000 workers by 2027.

The construction industry remains focused on building a more diverse and inclusive labour force. Efforts are ongoing to enhance the recruitment of individuals from groups traditionally underrepresented in the province’s construction labour force, such as women, Indigenous people, and newcomers to Canada.

Women in Trades

In 2021, there were approximately 190,000 women employed in Canada’s construction industry, of which 27% worked directly in on-site construction. However, of the 1 million tradespeople employed in the industry, women made up only 5% of the on-site construction workforce.

Indigenous People

The Indigenous population is another underrepresented group that provides recruitment opportunities for the construction industry. In 2021, approximately 63,700 Indigenous people were employed in Canada’s construction sector, or 9% of all Indigenous people in the workforce. Of those in the construction and maintenance industry, 81% work directly on construction projects.

New Canadians

The construction industry may also leverage new Canadians over the coming decade to meet anticipated labour market requirements. Canada is expected to welcome an average of more than 237,000 new international migrants each year between 2022 and 2027. This will make new Canadians a growing segment of the overall labour force. The national construction labour force is comprised of approximately 20% new Canadians, which is lower than the overall share of new Canadians in the total labour force (26%).

Increasing the participation rate of women, Indigenous people, and new Canadians could help Canada’s construction industry address its future labour force needs.