Canada faces construction labour crunch

Canada construction labour force
By 2027, about 21 per cent of Canada's construction labour force will be older than 65 years old.

In the next decade, Canada will see more than one fifth of its construction labour force retire from the jobsite.

Bob Collins, senior economist for BuildForce Canada, explained how the labour shortage will unfold, during the Ontario Chapter of the Associated Equipment Distributors’ (AED) power breakfast, held at Toromont Power Systems in Brampton, Ont. on March 22.

“This is a reality. There is no changing this,” Collins said.

In 1996, Canada’s construction sector employed 712,000 people. Today, that number has grown to 1.4 million. By 2027, however, about 21 per cent of the labour force will be older than 65 years old.

“They’re the people that are leaving and taking all their skills with them,” Collins said.

Fueling the labour gap is less youth entering the construction field. In 2007, about 13 per cent of the labour force was retirement age, with youth entering the field accounting for about 14 per cent of construction employment. By 2027, youth entering the workforce will fall to about 10 per cent of construction jobs.

“We have slower population dynamics and we have less youth coming in. That means we have a smaller piece of the pie that everybody has to pull from,” Collins said. “There are other industries that have a worse demographic than construction, but they all have to pull.”

In Atlantic Canada, the percentage of workers retiring is expected to reach 25 per cent.

“The challenge of Atlantic Canada is they’re not replacing themselves. Deaths exceed the births. They will need people coming in from outside,” Collins said.

Construction in the GTA

Looking to the Greater Toronto Area, the labour crunch is already in effect. BuildForce Canada ranks labour market conditions on a 1 to 5 scale, with five representing the worst-case scenario. Collins explained Toronto will rank as a 4 or 5 for the next couple of years.

“Toronto is scrambling to meet demand,” he said.

The GTA has also recorded its third year of increases in construction employment, as both residential and non-residential projects record annual gains.

“Any increased level of activity and the challenges seem much more acute, at least from the labour market side,” Collins said.

Asset shortages are also reflected in heavy equipment demand, Collins noted.

“Toronto had the highest concentration of cranes in North America,” he said. “You’re not going to be able to get a crane or equipment.”

Solutions

To meet the growing need for more employees, Canada’s construction sector will need to look to new demographics for recruitment.

“We will rely on new Canadians, the indigenous population and women,” Collins said. “Women in construction are four per cent, that’s it. There’s lots of room there.”

An increased effort in recruitment and apprenticeship training must also play a role in filling the labour gap. In Ontario for example, the province will lose 86,000 workers in the next decade. Furthermore, only about 50 per cent of those enrolled in training programs will complete their area of study.

“So, we don’t need 86,000, we need double that. Where are we going to get 170,000 people?” Collins said.

In Alberta, proponents on large-scale, public infrastructure projects are now required to employ apprentices in the 11 construction-related trades.

“It’s built into the contract. That’s how you replenish it,” Collins said.

Technology will also be a big factor in filling the gap, with the emergence of autonomous equipment.

“If you don’t have the workforce, it’s got to be productivity. There’s only so many ways to do it,” Collins said.  “There are opportunities. The industry is just challenged in the sense that it has to start recognizing those opportunities and taking advantage of them.”

BuildForce Canada is a national, industry-led organization that represents all sectors of construction in Canada. It’s mandate with providing timely labour market data and analysis as well as programs and initiatives to help manage workforce requirements.

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