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Turner & Townsend reports Q2 economic dip

Turner & Townsend reports Q2 economic dip

LEEDS, U.K.—The latest construction market report from Turner & Townsend confirms that ongoing supply chain problems and the lingering effects of the pandemic are slowing Canada’s economic recovery.

The reintroduction of restrictions and lockdowns across the country during Canada’s third wave of COVID-19 cases resulted in the economy contracting by 0.3 per cent during the June quarter, Turner & Townsend reports.

Restrictions across most provinces started easing over May and June, although a resurgence in cases over August and September has resulted in a number of provinces tightening restrictions again.

Domestic demand has been steadily strengthening over 2021, the Canadian Construction Market Intelligence Report states, but producers and manufacturers have struggled to keep up amid global supply chain pains. Inflation now sits at 4.4 per cent year over year.

The COVID Delta variant’s impact on international supply chains has slowed the anticipated recovery of the Ontario economy in the near term, states the report. However, the lagged re-opening meant that the Ontario economy will outperform the national economy in the third quarter and the province will enter the fourth quarter with renewed business confidence and a push to achieve forecasted five-per-cent growth year-over-year.

Home prices in Toronto continue to climb, with September the third-highest mark on record for the month according to the Toronto Regional Real Estate Board. Homebuilders are responding, with RBC anticipating a 25-per-cent growth in housing starts year-over-year.

Construction cost escalation and a severe labour shortage continue to be an issue within the Ontario construction Market, Turner & Townsend reports. While the commodity market has seemingly calmed down, there remains volatility and uncertainty within the industry, impacting the financial viability of mid- to long-term projects.

Toronto and Ottawa continue to lead the country in project starts.

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