Labour constraints threaten to slow Carney’s infrastructure ambitions, Deloitte warns
Prime Minister Mark Carney’s ambitious housing and infrastructure-building agenda could be hamstrung by labour shortages unless the government takes bold measures to increase employment in the trades, according to new analysis by Deloitte.
The country will need around half a million more tradespeople in the coming years to meet Mr. Carney’s goals of doubling the pace of home construction, fast-tracking “nation-building” infrastructure and catalyzing major private capital investment, said the Deloitte paper, published Wednesday.
“There’s a significant gap between our vision for building these projects and what delivery will be,” Trevin Stratton, national economic advisory leader at Deloitte, said in an interview. “There’s still time to be able to address it, but it needs to be done very quickly or almost even immediately.”
Mr. Stratton and his colleagues estimate there will be a shortage of between 410,000 and 520,000 tradespeople by 2030, based on the federal government’s stated construction goals. When factoring in the roughly 270,000 construction workers who are projected to retire by 2034, Deloitte estimates that the total gross recruiting requirements could rise to well over 800,000.
If these shortages are not addressed, there could be a “perfect storm” of labour demand, as happened in British Columbia in 2022 and 2023 when four megaprojects – the Coastal GasLink pipeline, Trans Mountain pipeline expansion, LNG Canada export terminal and Site C dam – all hit their peak labour needs at the same time.
A similar dynamic happened during the buildout of the oil sands in the early 2000s in Fort McMurray, Alta.
“There was a bidding war for a lot of people who were working in trades and in construction, for these types of projects: electricians, welders, crane operators, people working on concrete crews,” Mr. Stratton said.
“A lot of these major capital projects ended up not being delivered according to their timeline, and then, because of those overruns, also resulted in increasing costs.”
What’s needed is a co-ordinated push by various levels of governments, businesses, unions and educational institutions to recruit and train tradespeople, Mr. Stratton said. That could involve efforts to recruit more women, racialized Canadians and young people into the trades, and addressing “credential-recognition bottlenecks” between provinces.
Immigration programs, such as the federal Express Entry and provincial nominee programs, need to prioritize applicants with trade skills, he said – particularly given Ottawa’s broader reduction in immigration numbers.
Mr. Carney has emphasized the need to enhance productivity in home construction using prefabricated and modular building techniques. But these industries are still in their infancy in Canada, and even if there is a significant pickup in construction-sector productivity, there will still be a shortage of hundreds of thousands of workers, Mr. Stratton said.
Ultimately, the federal government will need to help co-ordinate project timelines, likely through the new Major Projects Office, Mr. Stratton said.
Industrial policy involves more than politicians deciding what sectors to focus on and support, he said. “Industrial strategy also involves figuring out how do we ensure that supply meets demand, and that we’re bringing the labour and resources that are going to be needed to build the big things that we want to build.”
This article was first reported by The Globe and Mail
