Ontario Construction News staff writer
Canadian construction companies are still grappling with a shortage of skilled labour, but many are reporting improved productivity and efficiency due to increased investment in technology, according to a new KPMG report.
The third biennial survey on digital and technology adoption in the construction industry, conducted in partnership with the Canadian Construction Association (CCA), found that 80 per cent of respondents said procurement processes are evolving to support innovation and the uptake of digital tools.
The findings are based on a survey of 265 construction companies across Canada, conducted from March 18 to April 4.
The report highlights growing concern about the industry’s ability to meet future demand amid a wave of retirements and limited recruitment.
Key findings include:
- 78 per cent of firms are facing a shortage of skilled workers, down slightly from 90 per cent in 2023.
- 70 per cent said labour shortages are impacting their ability to bid on or complete projects, compared with 86 per cent last year.
- 81 per cent said labour productivity and efficiency have improved due to technology investments.
- 56 per cent are prioritizing technologies that support a demand-driven supply chain.
- 53 per cent are prioritizing artificial intelligence and AI-driven software in their operations.
- 90 per cent believe tools like AI and analytics can boost productivity, up from 86 per cent last year.
Some of the technologies being adopted include drones for site surveys, robotic bricklaying, and modular or prefabricated construction — where buildings are made in a factory and assembled on site.
The labour crunch is particularly concerning for the residential sector. The Canadian Home Builders’ Association estimates that 22 per cent of residential construction workers will retire over the next decade, while the Canada Mortgage and Housing Corp. has said Canada needs more than one million additional workers to build 3.5 million new homes by 2030 to restore affordability.
“The industry is well aware of their labour conundrum,” said Jordan Thomson, KPMG in Canada’s national sector leader for building and construction. “The pressure is intensifying on the construction industry to do far more with less.”
The survey also points to a shift in procurement practices, although more change is needed, CCA president Rodrigue Gilbert said in a statement.
“It’s encouraging to see signs that procurement is beginning to evolve, but we’re not there yet,” said Gilbert. “Too often, the system prioritizes lowest price over long-term value, which prohibits investment in innovation.”
He said governments need to reform procurement practices to encourage collaboration and fair risk-sharing if they want a modern, productive construction sector.