Ontario Construction News staff writer
The COVID-19 economic clouds on Canada’s construction industry should dissipate and the industry should begin growing again in late 2021 and 2022, FMI Corporation based in Raleigh, NC in its 2021 North American Engineering and Construction Outlook: Second Quarter Edition.
In a video presentation, FMI managing director Jay Bowman said the growth is likely to be greatest in public sector infrastructure and slower in areas that will take longer to recover from the pandemic, notably offices, recreational and amusement/entertainment projects.
“It’s important to remember that even though we’re looking at an overall decline of maybe about 1 per cent before growing perhaps as soon as the second half of 2021, that recovery is going to be highly uneven,” Bowman said. He said British Columbia and the Maritime provinces will see “probably a faster recovery, whereas those in the central part of the country may be a bit slower in terms of their recovery.”
Government stimulus infrastructure spending should benefit transportation, sewage and waste disposal and highway construction, he said.
He said the Gross Domestic Product (GDP) in Canada declined by between five and six per cent in 2020, but is expected to recover by almost 4 per cent by the end of the year.
“There are three reasons why we should be optimistic about the economic outlook and therefore construction investment as well,” he said.
“First, there is consumer activity. We’re seeing an increased amount of spending on the consumer side which drives the majority of the economy.
“Second, exports are increasing, particularly in lumber and food and beverage, which beat recent expectations.
“And last, government stimulus – particularly we see that in the heavy civil and infrastructure side of things.”
Bowman said FMI’s non-residential construction index has rebounded from 47.1 in the last quarter to 54.4 now. “Anything over 50 suggests an increasing or expanding industry,” he said.