Amid pandemic, hopeful signs in development sector

Construction remains one of the most important industries for the Canadian economy, employing 1.2 million people who represent 7 percent of the country’s workforce. The industry could be worth $455 billion by 2024, according to a report from Randstad. 


The COVID-19 pandemic has affected every part of the economy, of course, including construction, and industry experts said it could take years before investments rise back to pre-pandemic levels. 


However, there are hopeful signs. 


The development and construction industry have not been hampered by social distancing measures as much as other sectors, like restaurants and retail, and engineering construction continues to offset declines in ICI construction (industrial, commercial and institutional). 


Industry experts expect that trend to continue for several more years, according to Daily Commercial News. 


Construction revenues overall have remained stable in Canada and the US. As governments look for ways to reinvest, the construction industry will likely remain a contender for large-scale projects. 


This was evident on February 11, when officials for the Canadian and Ontario governments announced a shared plan for a new Community Hub in Bancroft. 

“Investments in Ontario's infrastructure during this extraordinary time provide an opportunity to make our communities more sustainable and resilient,” the Ontario press release said. “Together, Canada and Ontario are working to reduce the impact of the pandemic, ensure health and safety, rebuild businesses, and promote job creation, growth and investment.”

The Government of Canada will invest about $750,000, the Government of Ontario is paying about $624,000, and the Town of Bancroft will contribute another $500,000.

In Ontario, engineering construction was driving the industry even before the pandemic, and the reinvestment in public transportation in Toronto and Ottawa has largely remained unaffected. Utility upgrades and mining in northern Ontario have also shored up the demand for engineering construction. 

The endurance of construction projects during the pandemic is also evident in Nova Scotia. In early February, officials approved $64.2 million in construction funding for three new Nova Scotia schools: an elementary school, middle school and education center. A spokesperson for the Department of Education told The Telegram that the additional funding was needed to address increased construction costs caused by the pandemic. 

Even as most ICI construction has been hard-hit by the pandemic, health care projects have continued to drive this sector, and should keep institutional construction stable until growth returns with a reopening economy. 

Of course, many workers remain adversely affected by the pandemic. 


Although construction employment increased after Canada’s initial spring shutdown, the unemployment rate rose to nearly 8 percent in 2020 from 5.3 percent in 2019. In March and April of 2020, the industry lost more than 90,000 workers, skyrocketing the unemployment rate in Ontario from 5.4 percent to 14 percent. 


Many of the projects that were scheduled pre-pandemic are still progressing. The biggest challenge for many construction companies will be receiving final investments to start construction. Delays are possible, but construction projects in Canada are ready and waiting.

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