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GTA leading Ontario construction growth


March 3, 2015
By Rock to Road

March 3, 2015 – Growth within Ontario's construction
industry – and its correlating job creation – is expected to occur at
significantly different rates across the province in 2015, according to the
annual Construction Confidence Indicator, released by the Ontario Construction
Secretariat (OCS). This is despite an overall confident outlook for Ontario's
$16 billion ICI construction economy.

March 3, 2015 – Growth within Ontario's construction
industry – and its correlating job creation – is expected to occur at
significantly different rates across the province in 2015, according to the
annual Construction Confidence Indicator, released by the Ontario Construction
Secretariat (OCS). This is despite an overall confident outlook for Ontario's
$16 billion ICI construction economy.

 

Findings from the province-wide survey of contractors,
prepared by the OCS and Ipsos Reid, show that the Greater Toronto Area is
expected to lead the Industrial, Commercial and Institutional (ICI)
construction industry in 2015. This activity is being driven by major public
transportation projects and urban infrastructure developments throughout the
GTA.

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Major infrastructure, manufacturing and public
transportation projects are also supporting confidence beyond the GTA. Some of
these include a $1 billion retooling at Chrysler in Windsor in preparation for
the next generation minivan, a $2.13 billion light rapid transit line under
construction in Ottawa, and an $857 million investment by Honda and the Ontario
Government to upgrade three plants north of Toronto.

 

In contrast, contractors in Northern Ontario have a
below-average construction outlook. However, mining projects from Vale and
Glencore after the survey was conducted may provide cause for greater optimism
in the region.

 

Firms that conduct work in Northern Ontario are the least
likely to have a positive view about their business going into 2015, as only 22
per cent expect to conduct more business, compared to 16 per cent who expect to
conduct less business this year. This marks the region's lowest level of
optimism since the recession in 2009.

 

"Low commodity prices explain the low levels of
confidence in Northern Ontario as mining companies withhold dollars for new construction,"
said Sean Strickland, CEO of the OCS. "To build a strong economy in
Ontario, we will need to tap into new opportunities in and outside of mining
and infrastructure development in the North. And a critical part of that
involves building a skilled workforce that's capable of meeting future demand
across the province."

 

Northern firms also cited the greatest shortage of skilled
labour – 91 per cent of contractors reported a shortage of skilled workers,
compared to 67 per cent in Toronto – suggesting some contractors in Northern
Ontario continue to have challenges finding sufficient skilled labour to meet
their needs, despite weakening confidence in the region.

 

"Signs of a rebounding manufacturing sector bode well
for Ontario's construction economy," said Craig Wright, Senior Vice
President and Chief Economist at RBC Financial Group. "As manufacturing
recovers, it will depend on a supply of skilled labour to help build
infrastructure, accelerate productivity and support economic growth."