The slow growth of the construction labour force and the ongoing supply chain disruptions are contributing to recruiting challenges for the red-hot construction industry. This is leading some builders to defer or even cancel projects as they look to fill record-high job vacancies.
According to Chris Gower, chief operating officer for PCL Constructors Inc.'s buildings group, project delays are not only financially costly for clients and their contractors but can also have wider disruptive effects as well.
Gower said PCL, one of the largest construction companies in Canada, has been turning down many opportunities simply because they don't have the resources to manage it. This is something that their company would never have done two years ago. He stated that this is one of the toughest labour markets they have seen in quite a while. This scarcity of labour is driving up costs and it's also making his company to have to make tough decisions to turn down work.
Yahoo! reports that construction continues to be among those industries to report gains in employment, increases in job vacancies and lower unemployment rates, according to BuildForce Canada, a national organization representing all sectors of the construction industry.
"We certainly don't think it's going to get better anytime soon. The demands right now for construction services are very high, particularly in Nova Scotia, Ontario, Quebec and British Columbia, but not exclusively. Those workers that were available are all being swallowed up by the expansion in demand and so you're seeing declining unemployment rates in the construction industry."
BuildForce's Executive Director | Bill Ferreira
Its industry report noted that construction investment rebounded strongly in 2021 as the economy recovered from the pandemic, with both residential and non-residential sectors seeing gains.
Ferreira said almost every province is starting to see that rebound in construction investment activity, yet the labour force has not had the opportunity to return and grow quite as quickly as it needs to, even though it has now almost exceeded its pre-pandemic levels. This labor shortage issue is widespread in almost all the trades right now - from labourers to carpenters to electricians to plumbers.
Statistics Canada recorded all-time high job vacancies in the construction sector in its latest report, with employers actively seeking to fill 81,500 vacant positions in the first quarter of the year.
This number is up 7.1 per cent, an additional 5,400 vacancies, from the prior quarter and more than double what it was before the pandemic hit in the first quarter of 2020. These large increases in vacancies are spread across many occupations, including construction trades helpers and labourers, where the number of vacancies is up 97 per cent, and carpenters, up 149.1 per cent.
Anyone that has expectations that we can get everything built in the same time frame for the same budget is just not being realistic.
John DeVries of the Ottawa Construction Association stated that the total labour demand in the sector was reportedly 9.3 per cent higher in the first quarter of 2020, as payroll employment rose 5.5 per cent since that time.
Employment and Social Development of Canada said demand for construction trades is likely to remain high. Citing BuildForce, it said the industry needs to recruit 309,000 new construction workers over the next decade, driven predominantly by the expected retirement of 259,100 workers, which makes up 22 per cent of the current labour force.
"People's expectations that we can get everything built in the same time frame for the same budget is just not realistic because there is way too much demand for construction and we only have so many labour resources. We are trying our best in the industry to recruit, but it's still not enough."
Ottawa Construction Association | John DeVries
DeVries stated that for some markets, growth has produced so much construction and is putting tremendous pressure on the entire industry to try to deliver services within schedule and price expectations.
EDI Weekly forecasts that certain trades and occupations, such as boilermakers, will be so scarce that in the coming years, they will be completely unavailable due to the excess demand. Recruiters will be forced to reach out to remote markets to find skilled workers in this trade if things keep going the way they are.
Other jobs, including construction managers, will be generally not available in local markets. Employers will have to compete for available workers, possibly beyond traditional sources and practices.
According to BuildForce projections, heavy-duty equipment mechanics, electrical power line and cable workers, steamfitters, pipefitters and sprinkler system installers will also be scarce.
One of the main reasons for this shortage of workers is because we have an aging population. Usually replacing retiring workers required several years of pre-planning to avoid the creation of skills gaps, but the pandemic has complicated the training and certification of new workers. Making matters worse, the pandemic slowed down immigration over the last couple of years, feeding into the labour shortage.
