3 Challenges facing the Construction Industry and What’s Being Done to Help
Canada’s construction industry is subject to the influence of local, national, and international markets, just like any other major industry that actively contributes to our economy. A rapidly diminishing workforce due to retirement, a complicated situation in Alberta’s oilfield, and a waning demand in the new housing market are just a few of the challenges Canada’s construction industry will face in the near future.
- Worker shortages and skilled labour challenges
The biggest challenge facing Canada’s construction industry is offsetting a rapidly aging workforce. There’s a need to replace approximately 210,000 workers that are retiring in order to fulfil building needs before 2021. Replacing 24% of the workforce over the next few years will be a difficult challenge because of a diminishing pool of young job seekers
There’s also a need for skilled workers in the electrical generation and transmission, mining, and oil and gas pipeline industries. If Canada’s construction industry is to have any chance of keeping up with demand, we must focus on training, labour mobility, and immigration while retaining the experienced, specialized workers currently in the industry.
- A complicated situation in Alberta’s oilfield
Alberta has risen to the challenge of the ebbs and flows of construction cycles before, but we haven’t faced a situation this complex in several decades. Labour requirements in oilfield construction are set to decrease 28% from the peak in 2014 to 2020. Low oil prices also prompted a decline in engineering, institutional, and industrial construction that’s set to hold steady through to 2019.
- Demand for new housing slowing down, despite slight growth in renovation work
Steady growth for renovation work in the residential construction industry isn’t enough to combat the decrease in demand for new housing developments. Total residential construction is set to fall by 9,000 jobs between now and 2019. Mortgage rates are expected to increase, which will put pressure on Canadian household budgets. International regulators are also worried about the temperamental Canadian housing market and are beginning to implement policies to weaken it.
Despite these challenges, the construction industry is countering the downward fluctuations with major infrastructure projects, sustaining capital, and maintenance work that supports Canada’s new resource capacity. Despite oil investments declining, opportunities in pipeline, transportation systems, electricity generation and distribution projects are on the rise. The federal government promoted these important drivers of labour market demands during their election campaign, and government investment in infrastructure couldn’t come at a better time for Canada’s construction industry.