How Construction is helping Canada

Booming construction industry good news for Canadians

Canada’s construction industry has been considered an indicator of how healthy the county’s overall economy is doing because it has such an impact on secondary industries. Government revenue, investments and the retail industry are all affected by what happens in the country’s construction industry.

Now, with the industry booming for nearly a decade more and more attention has been paid to it, particularly the ups and downs that are part of the annual construction cycle.

The worth of Canadian construction

Canada’s construction industry provides jobs for 1.24 million workers and brings in $171 billion. That works out to about one in 13 workers in the country being employed in the industry, according to Build Force Canada.

The growth of Canada’s construction industry over the past few decades has demonstrated the county’s overall strength on the global market. In 1997 the construction industry was worth $61.2 million and it has now grown into the billions, according to Trading Economics.

While Toronto and Vancouver remain two of the hottest housing markets the rest of Canada has been heating up too. One housing expert told Business Insider that over 50 per cent of the markets in the county had seen an increase.

In fact, total housing starts for the second quarter of 2017 were 55,147, which was up over the same time last year 53,286, according to Statistics Canada. The number of housing units that were under construction in Q2 of 2017 were 230,113, up over Q2 2016’s number of 216,304.

The value of building permits has also increased month over month, according to CTV News. In January the value rose over five per cent from the previous month, up to $7.6 billion.

The impact of Canadian construction

The construction industry impacts a lot of secondary industries including real estate, banks or lenders, developers and investors as well as others.

Most cities make the bulk of their revenue from property taxes and as a result their budgets are largely dependant upon a healthy income from land taxes and the like. In Toronto, the residential property tax and land transfer tax combined bring in nearly 40 per cent of the city’s revenue.

The hot housing market has been holding up Canada’s economy, according to the Globe and Mail, something that is directly connected to the country’s construction industry. The paper reports that overall Canada was expected to see about a four per cent growth in the first quarter, something that puts it at the top of the Group of Seven.

The impact that the county’s construction industry has trickles down to municipalities, boosting local economies in the same way that it does for the national one. Both Halifax and Kingston have reported stronger local economies thanks to the construction industry. In Halifax experts claim that housing starts have risen nearly 75 per cent.

The overall industry statistics do not necessarily reflect what is happening on a more local scale. For example, Prince Edward Island housing starts were up 97 per cent over 2016 while Quebec has only recently seen an upswing. The province had been recording a 22 per cent decrease until June. As well, the numbers in Toronto have remained strong while in Vancouver construction has been slowing down.

The trickle down effect of the construction industry impacts many secondary industries including real estate sales, printers, coffee shops, furniture stores and more, as documented in a Toronto Star report.

The future of Canadian construction

The activity for Canada’s construction industry has been increasing year over year, according to Global News. One of the biggest growths has been in public sector projects, the media outlet reports.

The Canadian Mortgage and Housing Corporation has predicted a stronger construction year for 2017.

“The trend in housing stats for Canada reached its highest level in almost five years,” Bob Dugan, CMHC’s chief economist was quoted in a press release.

“So far this year, all regions are on pace to surpass construction levels from 2016 except for British Columbia, where starts have declined year-to-date, after reaching near record levels last summer.”

Any increase in projects will be a result of previous investments including the $81.2 billion earmarked by the federal government and the $137 billion the Ontario government committed to construction projects over the next several years.


The Canadian construction industry impacts so many other industries that when it is strong other industries also reflect strong numbers. Because the industry has been growing strong over the past several years many of the other industries can also anticipate strong revenues, including federal, provincial and municipal governments. In many cities the local budgets rely heavily on the construction industry as well as the related businesses including real estate and investors.

With experts predicting a strong construction market over the next few years, many believe the future looks bright for Canada.