Rock to Road

Government spending supports non-residential construction

September 11, 2009  By  Andy Bateman

11,2009 – The recession has weakened the outlook for Canada's non-residential
construction industry in 2009, but the industry is benefiting from increased
government spending on infrastructure, according to the Conference Board's
Canadian Industrial Outlook – Canada's Non-Residential Construction Industry –
Summer 2009.

profits are expected to decline by 33 per cent from last year's highs, the
industry is performing surprisingly well. Strong spending on institutional
buildings, notably social housing, schools and hospitals, is supporting the
industry's outlook this year," said Michael Burt, Associate Director,
Industrial Economic Trends.

industry posted record profits of $1.9 billion in 2008, which will dip to $1.3
billion in 2009. The recession lowered demand for office and industrial space.
But the industry-particularly in western Canada- had already started to cool
down before the recession began, which made the downturn less abrupt. On the
downside, prices are forecast to decline this year after three years of strong
growth. In addition, cost growth remains a concern: key material costs have not
fallen significantly, and a labour shortage still exists for specific trades.

are forecast to range between $1.2 billion and $1.3 billion annually between
2010 and 2013.


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