TORONTO — A new report forecasts cautious optimism for the Canadian construction sector in 2024 with slow growth but some bright spots.
Arcadis’s 2024 International Construction Costs Index said in 2023 Canada’s GDP rose by 1.1 per cent marking the third consecutive year of expansion but the growth rate “underscores the challenges faced by the construction industry and has resulted in the cities of Toronto, Vancouver, Calgary, and Montreal falling within the top 50 most expensive places to build globally.”
“Overall, the construction market in Canada is one of opportunity with some sectors requiring a bit more caution and patience, notably residential. Looking ahead, the availability and capacity of skilled labour to participate in construction projects will be a growing constraint,” Arcadis business area director Audrey Jacob said in a statement.
The reports forecasts continued slow growth as near-cyclical high-interest rates temper investor sentiment and moderate expectations, the release said.
Housing was cited as a critical issue across Canada driven by federal immigration policy fuelling both population growth and consumer demand. The report noted the federal government is addressing housing pressures by allocating $6 billion to the Canada Housing Infrastructure Fund, and highlighted other major investments in health care, education and infrastructure including the high-speed rail project between Quebec City, Montreal, Ottawa and Toronto which it said is expected to advance with a contractor appointment slated for summer 2024.
The report also said Canada’s industrial and manufacturing sectors demonstrate resilience and are buoyed by onshoring trends and just-in-time delivery practices.
The 2024 Arcadis International Construction Costs Index covers 100 major cities worldwide and assesses 20 different building types across residential, commercial, and public sectors, the release said.
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