Ontario Construction News staff writer
The Royal Institute of Chartered Surveyors (RICS) and the Canadian Institute of Quantity Surveyors (CIQS) released their latest Construction Monitor for the second quarter of 2024, revealing that overall sentiment for the industry remains positive.
The report noted that construction activity remained unchanged in the quarter when compared to the first three months of the year, indicating a consistent picture across the sector. The strongest areas of growth were found in the energy and transportation sectors.
New housing project starts, prices, and sales remained a bit subdued, but the RICS-CIQS dataset collected data on ongoing development work rather than new ground breaking or completion transactions. The office and retail construction sectors also continued to show negative trends.
The Bank of Canada (BoC) lowered interest rates by a quarter point in July, and while further rate cuts are expected, a more dovish pivot by the BoC is fuelling the anticipation that monetary accommodation will come sooner rather than later. This outlook is conducive to a positive outlook for the industry.
Both skills and general labor shortages were identified as key challenges holding back market activity, with two-thirds of respondents citing these as critical factors. The RICS-CIQS survey also found that the recruitment challenges for skilled trades were most severe. However, the area of skilled trades where the challenges are most severe was not significantly different from the previous survey, suggesting that there is an opportunity for improvement.
CIQS Chief Executive Officer Sheila Lennon said in a statement: “The Bank of Canada has forecasted an economic growth increase for the remainder of 2024 and into 2025, which should result in us seeing a continued momentum in the infrastructure sector. The interest rate cut in July along with market stipulating that further cuts in 2024 are forthcoming, should lower mortgage rates, making it more financially palatable for builders and owners to take on new mortgage debt loads in both the residential and non-residential sectors to help stimulate an increase in workload in these sectors.”