It’s boom times ahead for the BC construction industry, says Manley McLachlan, president of the BC Construction Association. “BC’s construction industry is heading into one of the most growth-oriented, demanding times in its history,” he says. “The construction sector’s contribution to BC’s total GDP is expected to increase by 31 per cent over the next three or four years, and we’re looking at an estimated $206 billion.”
Manley also dismisses concerns that future activity will only be around LNG investment and future pipeline activities in the north. “It’s important to note there’s construction activity all across the province, not just in the north,” he says. “Although LNG investment will certainly add to the activity, we have plenty going on already.”
That’s in line with record growth rates across the country, notes Michael Atkinson of the Canadian Construction Association.
“ICI has been going on a tremendous pace for some time now,” he explains. “According to Stats Canada, in 2014 both ICI and residential construction combined were $293 billion. Just 10 years ago, that was only $150 billion—in the space of 10 years, it’s almost doubled.”
Atkinson credits an active resource sector, particularly in Alberta, BC, Saskatchewan, and parts of New Brunswick and Newfoundland, for the activity. But public infrastructure and transportation projects have also been instrumental in keeping the industry busy—projects that get larger each year.
“ReNew Canada publishes the top 100 public projects every year, and the volume of those 100 projects goes up every year,” he explains.
Something like 43 of them this year are valued at about a billion dollars or more.”
In the big picture, according to BuildForce Canada, British Columbia’s overall economic growth is expected to average 2.7 per cent to 2018, stronger than the Canadian average of 2.4 per cent over the same period. In its Preliminary Investment Trends report for BC from 2015 to 2024, it notes that while the last few years have been weaker in the commercial and institutional construction sector, ICI building investment is expected to rise in the coming years thanks to major resource projects (including those predicted LNG terminals). Industrial building construction is expected to peak by 2018, but stay steady after that—and well above historic levels in the early 2000s. In the residential sector, according to the same report, new housing investment isn’t expected to change significantly, but should see a boost from growth in renovation work.
On the more local level, Vancouver Island has seen a fairly healthy multi-family residential sector in the Victoria region, along with independent living facilities built in Comox, Courtenay, and Victoria, and multiple Defence Construction Canada projects at CFB Esquimalt. There has been strong investment in the commercial sector across the island (including several mall upgrades and Target renovations), but overall, says Greg Baynton, CEO of the Vancouver Island Construction association, 2015 is going to be a transition year toward more positive growth in the industry. “It’s been six years of a depressed economy in the ICI,” he explains. “The bottom line is the Vancouver Island-based industry is looking forward to significant increase in construction investment across all sectors of the residential and non-residential construction markets in 2015, and be sustained to 2020.”
However, busy times aren’t necessarily translating into healthy bottom lines, as the Vancouver Regional Construction Association’s president, Fiona Famulak, points out. “The market is tough, materials and people costs are high, and margins are very thin,” she says. “In addition to driving people costs skywards, BC’s skill shortage is preventing some from either bidding on work or from implementing growth plans.”
Everyone remains concerned about both labour shortages and just as importantly, an aging population. “The perfect storm of labour market demographics in a rapidly expanding economy across most of Canada will generate a significant skills shortage in trades and management,” says Baynton. “And despite this predictable perfect storm, government has been closing shop classes in our high schools, thereby eliminating the exposure to trades and career options other than a purely academic path.”
The BCCA’s McLachlan echoes Baynton’s concerns. “We have a lot of work to do to get BC’s work force skilled up and experienced enough to fill the jobs that are coming,” he says. “And while the LNG opportunities will increase the demand, even without LNG we’re looking at a shortage of over 26,000 skilled trades people by 2021. That’s going to take a concerted effort in the short term and a cultural shift in the long term: we’re really encouraging parents to rethink the trades and discuss the opportunities with an open mind.”
“We can no longer tolerate the fact that a career in construction is perceived as a second-best choice,” agrees Famulak. “Realistically there will always be demand, be it here or abroad. We need specific policies to ensure youth, women, and aboriginal workers understand the opportunities and engage them so they are part of the solution to our skills shortage.”
The BCWCA has been continuing to target skills shortage as a top priority, and will be participating in Skills BC again this year. (Last year’s project saw 5,000 participants walking through BCWCA’s booth.) “Our trade is so misunderstood,” says BCWCA executive director Leesa Matwick. “Every single person thought we were carpentry—we’re working to see the organization be better understood and recognized.”
The organization is also working to review its curriculum for the wall and ceiling training program.
“Drywall finishing is in a bit of trouble right now,” she explains. “The Industry Training Authority was going to dump the program, but our instructor, Stuart Baird, says he’s managed to convince them to hold on, and he’s going to drum enthusiasm back in.”
In terms of working conditions, Matwick has been hearing frustration from her members about last-minute changes that they’re seeing to jobs within hours of closing. “It makes their bid not relevant, or they toss it out because it doesn’t include the right pricing,” she explains. “We’ve been asked by one of our members to look into this—there really aren’t any rules or regulations about this right now.”