The Canadian Construction Association (CCA), in partnership with the Construction Sector Council (CSC) recently released a 5-year economic and employment forecast for the Canadian construction industry. For the first time, data for this 5-year forecast was supplied by the Construction Sector Council.

The forecast suggests that after two strong years, the construction industry is set to record a more moderate performance in 2007. Following growth in construction investment of 3.2 per cent in 2005 and 3.4 per cent in 2006, construction investment is expected to grow by only 1.7 per cent in 2007, 1.7 per cent in 2008, and 1.7 per cent in 2009.

However, investment rates mask significant differences between the non-residential and residential construction markets. Non-residential construction investment has boomed over the past two years - recording growth of 7.4 per cent in 2005 and 7.2 per cent in 2006.

Non-residential construction growth will moderate to 3.2 per cent in 2007 and 2.2 per cent in 2008. Residential construction investment has been in the midst of a decline - investment dropped by 1.6 per cent in 2005 and 1.1 per cent in 2006 - a further drop of 0.1 per cent is expected in 2007. It will not be until 2008 that residential construction will rebound, with growth of 1.3 per cent expected in 2008.

Employment growth is also expected to cool. After the construction labour force grew by 7.1 per cent in 2005 and 2.7 per cent in 2006, the workforce is expected to grow by 0.9 per cent in 2007, averaging over 1,055,000 workers. With over 150,000 workers set to retire over the next ten years, or 19 per cent of the current workforce, the supply of labour will be a continuing challenge.