Top 10 Canadian construction trends to watch in 2022

(PHOTO © SITTINAN/ADOBE STOCK)

1. SLINGSHOT OR STOP/START RECOVERY

Private sector and governments flow projects to take advantage of the opportunity to build back better, employ Canadians, and accelerate the economy. This could be constrained by brakes like restrictive workforce quotas, lack of workforce, rising inflation, and continuing challenges in supplies and materials.

2. WILL FEDS DELIVER ON PROMISE TO COLLABORATE ON A LONG-TERM INFRASTRUCTURE STRATEGY?

The CCA, on behalf of the industry, has been advocating for a long-term infrastructure plan and was encouraged by the response of the federal government to industry’s feedback on what a national infrastructure assessment should look like. This needs to be a priority for the new Minister of Infrastructure, Dominic LeBlanc.

3. SCALING UP TRADE-ENABLING INFRASTRUCTURE

Economic revival is a top priority for all Canadians. Almost two-thirds of Canada’s GDP comes from trade, but we have fallen behind in building the trade infrastructure we need to capitalize on and expand into new global markets. With estimates from the World Bank and World Economic Forum saying the reliability and readiness of Canada’s trade infrastructure has fallen from 10th best in the world in 2009 to 26th today, we need a massive scale-up in our country’s trade infrastructure.

While the United States remains Canada’s most important trading partner, China’s strength as an economic power is undeniable. Asia Pacific trade will play a big part in Canada’s future economy. Canada will require a long-term strategy including investments in existing trade gateways and corridors, new marine and inland ports as well as road, rail and air transportation that will support the freight and passenger flows required for growing international trade.

4. FOCUS ON APPRENTICESHIPS

While the shortage of skilled workers facing the industry is nothing new, its implications on Canada’s swift economic recovery are more dire. Employment growth in Canada is expected to average one per cent annually between the years 2020 and 2024, creating just over 900,000 jobs over the next five years. In the construction sector, the average annual growth outlook suggests employment growth will likely average approximately 0.6 per cent per year between 2020 to 2024.

There is a need for a national strategy to recruit and retain more than 375,000 apprentices in Red Seal trades over the next five years. Skilled tradespeople cannot be created overnight. Poaching from within the industry exacerbates the problem. Now is the time to focus on a national, coordinated workforce capacity strategy and boost skilled training programs.

5. SUPPLY CHAIN INSTABILITY; CALLS FOR MADE IN CANADA

Virtually every material from lumber to steel has gone up in price. The fluctuating cost of building materials and the unpredictability of the supply chain are affecting budgets, estimates, and bids. The industry needs to look long and hard at areas that can be optimized to drive a better bottom line, including modernizing the tendering process.

Canada will be looking harder at the opportunities and the challenges of re-patriating Canadian knowledge and manufacturing.

We also need to reduce delays in granting contracts and address cost escalation so that the sub-contractor isn’t left footing the entire bill for soaring material costs. The industry faces challenges with both spiking material prices and labour shortages. Finding skilled labour, managing price volatility, and mitigating the risks that come with rising costs are top priorities.

6. THE DELIVERY MODELS ARE CHANGING

Projects are becoming more complex and there is no one-size-fits-all form for financing, designing and managing them. Current procurement practices have contractors shouldering a disproportionate share of the risk. With productivity and sustainability issues on the rise, including net-zero carbon targets, and shortages in material and labour affecting profit margins, it is high time the government refreshed its approach to procurement.

To build the infrastructure needed across the country and recruit the workforce of the future, federal procurement strategies need to adapt to encourage innovation, account for long-term value and sustainability, promote the use of alternative delivery models, and support shared risk.

7. GREEN OUTCOMES IDENTIFIED IN PROCUREMENT PROJECTS: BUT WILL FUNDING BE SUFFICIENT?

Public interest in sustainable investment has grown significantly over the past 12 months. There is increased activity worldwide to promote greener construction. Reinforced by commitments to the Paris Agreement, a growing number of countries are reaffirming net-zero carbon emission targets, including Canada. At the same time, consumers are demanding socially and environmentally responsible business practices and projects.

During this decade, rising sea levels and rainfall increases can cause flood damage to homes and buildings with costs as high as $13.6 billion annually. Temperature and rainfall-related damage to roads and railways could increase by up to $5.4 billion annually, and heat and rainfall damage to electrical transmission and distribution infrastructure can cost utilities and ratepayers up to $4.1 billion annually. Early investment in adaptation can substantially reduce the impacts and costs to infrastructure of a hotter and increasingly volatile climate by over 90 per cent or $20.79 billion annually.¹

8. FOCUS ON INCLUSIVE AND COLLABORATIVE CORPORATE CULTURE

Traditionally, construction has been highly siloed, with the ability to drive low cost as the primary driver. As Canadian society is increasingly embracing diversity and inclusivity, these values are being expected of Canadian firms. In a tight labour market, companies who are unable to adapt will be left behind as workers migrate to those where they feel valued.

There will also be some work to do in re-integrating office workers. This could potentially mean re-shaping these roles particularly where some may seek permanent remote roles or where there is an opportunity to hire from under-served markets or communities. Consideration will need to be given to minimizing potential conflicts between office and site workers who have different, but equal challenges adapting to COVID and a post-COVID world.

9. CYBER SECURITY IS EVERYONE’S BUSINESS

Millions of people moved from their offices to their homes, sharing data over the internet, in record volumes. Completing daily COVID forms became the norm, as did increased use of IoT for safety, productivity, or auditing purposes. All of these transactions became potential portals for cyber-attacks – and many firms, sophisticated or not, became targets, and sometimes, victims.

While the security industry is creating more shields, a significant threat remains. Cyber security can no longer be limited to the CTO or CIO. More training, more controls and more auditing will be necessary to ensure that companies get the benefits of a connected world, while minimizing or eliminating the very real threat to their business from cyber-criminals.

10. DATA SHARING: AN INDUSTRY GAME-CHANGER

Data is king – but only if you can aggregate it and use it to drive decision-making. Each time a project is managed through its milestones it creates a huge amount of data which rarely gets used again. This data can take the form of schedules, financial budgets, workflows, incident reports and lessons learned. There is a lot we can learn from sharing data that is collected on construction sites. Companies are beginning to look at entering into data alliances because the more data collected the better predictive analytics can be leveraged to assess risk, increase safety and improve productivity. Applying advanced data analytics and machine learning to predict how projects will perform in the future will allow companies to focus on problems before they arise and understand the probability of risk involved.

¹ https://climatechoices.ca/wp-content/uploads/2021/09/Infrastructure-English-FINAL-Sep29.pdf