Alberta’s construction sector poised for a near-term peak

BuildForce Canada has released its 2023–2032 Construction and Maintenance Looking Forward report for the province of Alberta. The outlook calls for construction employment to remain unchanged in 2023, before experiencing a series of contractions through at least 2026 as the residential-construction sector experiences a series of setbacks, with demand for new housing declining.

Activity in the non-residential sector, meanwhile, is underpinned by ongoing major road, highway, health, education, commercial, industrial, and public-transportation projects, as well as growth in the oil and gas sector.

The modest gain (+2%) in non-residential employment that occurs as a result is more than offset by a loss of 10% in residential employment across the 10-year forecast period. Overall employment contracts by 3%. These numbers are based on existing known demands and do not take into account the federal government’s goal to double the number of new homes built across Canada over the next 10 years, nor the anticipated increase in demand for construction services related to the retrofit of existing residential, industrial, commercial, and institutional buildings to accommodate the electrification of the economy.

“The challenge for Alberta’s construction and maintenance sector will be developing a broad-enough labour force in the short term to match employment gains,” says Bill Ferreira, Executive Director of BuildForce Canada. “Many trades are facing recruiting challenges at the moment. Although a slowdown in the residential sector will help to ease some of those pressures, a long list of major projects in the non-residential sector, combined with seasonal industrial shutdown and maintenance activity, will keep that pressure elevated.”

The BuildForce Canada forecast anticipates that Alberta’s construction industry will need to replace an estimated 38,200 workers, or 21% of its 2022 labour force, who are expected to retire by 2032. The province’s younger demographics should help to close much of that gap, with an estimated 38,000 new workers under the age of 30 projected to enter the labour force from the local population. This leaves a recruiting gap of approximately 5,100 additional workers – those positions created in response to sectoral growth – to be filled by 2032.

The development of skilled tradespersons in the construction industry takes years, and often requires participation in a provincial apprenticeship program. New registrations in Alberta’s 25 largest construction trade programs experienced significant declines between 2014 and 2019, contracting by 57%. That rate was far greater than the 19% contraction in employment over the same period. Completions were also trending down across the same period, albeit at a slower pace. Combined, these trends are likely to reduce the near-term numbers of new certified workers.

Based on projected new registrations and completion trends, several Alberta trades may be at risk of potentially undersupplying the number of new journeypersons required by 2032. Trades within this group include Boilermaker, Bricklayer, Carpenter, Construction Electrician, Glazier, Heavy-Duty Equipment Technician, Hoist Operator (Boom Truck), Hoist Operator (Wellhead) Industrial Instrumentation Technician, Industrial Mechanic, Insulator (heat and frost), Powerline Technician, Roofer, Sheet Metal Worker, and Welder.

The construction industry remains focused on building a more diverse and inclusive labour force. To that end, efforts are ongoing to enhance the recruitment of individuals from groups traditionally under-represented in the province’s construction labour force, such as women, Indigenous People, and newcomers to Canada.

In 2022, there were approximately 37,500 women employed in Alberta’s construction industry. That figure represented an increase of about 1,500 over 2021 totals. Of them, however, only 32% worked directly in on-site construction. As a share of the total, women made up just 7% of the 174,700 tradespeople employed in Alberta’s construction industry in 2022. These figures are virtually unchanged from 2021.

The Indigenous population is another under-represented group that presents recruitment opportunities for Alberta’s construction industry. The province has historically been successful in increasing the share of Indigenous People in its construction workforce. In 2021, Indigenous workers accounted for 6.7% of the province’s construction labour force, which is a slight increase over totals reported in 2016 and is notably higher than the share of Indigenous People represented in the overall labour force. As the Indigenous population is the fastest growing in Canada and Indigenous workers seem predisposed to the pursuit of careers within the sector, there may be scope to further increase the recruitment of Indigenous People into the province’s construction industry.

The construction industry is also committed to the recruitment of newcomers to Canada. Based on historical settlement trends, Alberta is expected to welcome an average of nearly 63,900 new international migrants each year between 2023 and 2032, making the immigrant population a key potential source of labour force growth. Currently, newcomers and more established immigrants make up about 19% of the province’s construction workforce.

Increasing the participation rate of women, Indigenous People, and new Canadians could help Alberta’s construction industry address its future labour force needs.

BuildForce Canada is a national industry-led organization that represents all sectors of Canada’s construction industry.