Construction Labour Shortage: Retirement Wave
The shortage of workers in the construction industry is significant, with thousands of positions unfilled. According to experts, this issue may get even worse in the near future due to an anticipated wave of retirements. This challenge comes at a time when Canada is already facing a shortage of millions of homes required to achieve housing affordability goals within this decade. In a recent note, Benjamin Tal, Deputy Chief Economist at CIBC, highlighted that the construction industry is experiencing an unprecedented job vacancy rate, reaching a record high of approximately 80,000 vacancies. Tal predicts that approximately 300,000 employees will retire within the next ten years. According to the BuildForce Canada report, recruitment initiatives will need to address a total of approximately 118,900 vacancies in the construction industry by 2033. ___________________________________________________________________________________________
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Furthermore, the shortage of skilled workers is having a notable impact on the industry’s efficiency. The Canada Mortgage and Housing Corporation (CMHC) projects that the country will require an additional 3.5 million homes by 2030 compared to the current pace of construction. However, the number of new homes being built has been declining, with 271,000 homes in 2021 decreasing to 260,000 in 2022. In May 2023, the rate of housing starts experienced a significant 23 percent month-over-month drop. As a result, the CMHC’s chief economist has estimated that only 210,000 to 220,000 new homes will be constructed by the end of the year.
According to Reva Bond, dean of the construction school at the Southern Alberta Institute of Technology, the fluctuating nature of the job, where the hourly pay is lucrative but subject to demand-driven variations, has also prompted certain individuals to exit the industry. Bond mentioned that despite the initiatives undertaken by educational institutions like SAIT to engage with high school students, as well as the availability of credit programs and scholarships, attracting the younger generation to the sector remains a challenging endeavor.
There is a growing need to allocate a higher proportion of immigration opportunities to individuals with expertise in skilled trades. In May, the federal government introduced category-based selection for the Express Entry program, prioritizing trades as one of the key areas for work experience. However, while increasing the number of skilled trades immigrants is beneficial, Bond emphasized the importance of focusing on strategies to retain these workers within the industry.
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