Ontario Construction News staff writer
Construction activity in Ontario is expected to expand over the next decade, driven by a rebound in residential building and sustained investment in major institutional, commercial, industrial and infrastructure projects, according to a new industry forecast.
BuildForce Canada’s Construction and Maintenance Looking Forward report for Ontario, released Monday, projects construction activity will increase through 2035, with both residential and non-residential sectors contributing to growth.
The outlook identifies a short-term slowdown in residential construction as the industry adjusts to economic uncertainty, lower immigration levels and elevated inventories of unsold housing units in some markets. However, residential activity is expected to return to growth beginning in 2028, supported by demand for both single-detached homes and multi-unit housing.
At the same time, non-residential construction is expected to remain a major driver of activity, with elevated investment levels continuing into the early 2030s as work progresses on large-scale healthcare, education, transit, energy and industrial projects.
“Ontario’s construction outlook reflects strong underlying demand across both residential and non-residential sectors,” said Irwin Bess, executive director of BuildForce Canada.
“Although activity in the residential sector is projected to be constrained in the short term by key factors such as uncertainty created by the ongoing tariff dispute between Canada and the United States, by reductions in immigration levels, and, in some regions, an abundance of unsold multi-unit residential dwellings, the outlook is strongly positive in the middle and longer terms.”
By 2035, residential construction employment is forecast to increase 11 per cent compared with 2025 levels, with the strongest gains expected in new-home construction and renovation activity.
Non-residential construction employment is projected to rise 5 per cent over the same period, as growth in institutional, commercial and industrial building construction offsets declines expected in engineering construction as major projects reach completion.
“Meanwhile, construction activity in the non-residential sector is projected to rise into the late 2020s and remain elevated to the end of the forecast period as work continues on a long list of significant projects across all six regions,” Bess said.
The report divides Ontario into six construction regions — Central, Eastern, Greater Toronto Area, Northeastern, Northwestern and Southwestern — each with different project pipelines and labour demands.
Central Ontario
Central Ontario is expected to see significant construction growth through the forecast period.
After a short-term decline, residential activity is projected to increase substantially after 2027, driven by renewed housing construction and strong renovation demand.
Non-residential activity is also expected to rise between 2027 and 2031, supported by major institutional and industrial projects, along with engineering work tied to transit and utility investments.
By 2034, construction employment in the region is projected to increase 21 per cent in residential construction and 11 per cent in non-residential construction.
Eastern Ontario
Eastern Ontario’s construction sector is expected to grow steadily through 2035 following a slight decline in overall investment levels in 2025.
Residential growth will be driven by new-home construction, particularly demand for single-detached homes, along with increasing renovation activity.
The region’s non-residential sector is expected to remain historically strong, supported by major infrastructure, institutional and industrial projects. Activity is projected to peak around 2030 and remain elevated through the remainder of the forecast period.
Employment is expected to rise by 10 per cent in residential construction and 7 per cent in non-residential construction by 2035.
Greater Toronto Area
Construction activity in the GTA declined in 2025, largely due to challenges in the residential market, including higher costs, slower population growth and unsold condominium inventory.
However, the outlook calls for residential construction to return to growth after 2028.
The non-residential sector continues to benefit from major transit, utility, healthcare and education projects, although activity is expected to decline from peak levels after 2029 as existing projects wrap up.
By 2035, employment is projected to increase 5 per cent in residential construction and 4 per cent in non-residential construction.
Northern Ontario
Northeastern Ontario is expected to see continued residential growth, supported by demand for new housing and renovations, although non-residential activity is projected to moderate as major mining projects conclude.
By 2035, residential construction employment is forecast to decline by 3 per cent, while non-residential employment is expected to increase by 1 per cent.
In Northwestern Ontario, residential construction is expected to expand over the forecast period, while non-residential activity is projected to peak in 2028 before declining as major mining projects are completed.
Employment is forecast to decline by 2 per cent in residential construction and 5 per cent in non-residential construction by 2035.
Southwestern Ontario
Southwestern Ontario is expected to see strong residential growth after 2026, led by demand for single-detached housing.
Non-residential construction is projected to decline after 2027 as the sector moves away from earlier peak levels, although continued institutional, commercial and industrial building activity will provide support.
Employment is expected to rise 10 per cent in residential construction, while non-residential employment declines 2 per cent.
Despite strong construction demand, BuildForce Canada warns Ontario’s construction industry could face significant labour challenges over the coming decade.
An aging workforce is expected to result in as many as 92,000 retirements by 2035. Combined with an estimated need for 34,100 additional workers to meet rising demand, the industry could require 126,100 new workers over the forecast period.
The province is expected to recruit about 98,800 new workers under age 30, leaving a potential labour gap of approximately 27,300 workers.
“The overall labour force trends are now such that Ontario is projected to see more new entrants coming into the industry than there are retirees exiting the sector,” said Marc Arsenault, business manager and secretary treasurer of the Provincial Building and Construction Trades Council of Ontario.
“While that’s a strong positive, we cannot lose sight of the fact that training and retention will be key to keeping these workers in our sector and turning them into experienced journeypersons.”
