By Mark Buckshon
Ontario Construction News staff writer
Ontario’s non-residential building contractors are navigating a complex landscape of opportunities and obstacles. While a strong project pipeline and technological advancements fuel optimism, rising costs, labor shortages, and political uncertainty temper enthusiasm.
This is the picture painted by the annual Ontario Construction Secretariat (OCS) Contractor Survey, released at their 25th Annual State of the Industry and Outlook Conference on March 6. OCS represents unionized contractors and Ontario’s building trades unions.
The survey, conducted in January, reveals a generally positive outlook. 67% of contractors expressed confidence in the future of the industry, with 80% anticipating stable or rising revenues. This positivity is driven by significant government investment in infrastructure projects, including roads, transit, schools, and hospitals.
In a statement OCS CEO Brian Barron acknowledges the uncertainty while emphasizing the robust project pipeline that sustains optimism across the province. Notably, optimism is higher outside the Greater Toronto Area (GTA), with 73% of contractors feeling positive compared to 56% within the GTA.
“There is a lot of uncertainty in the market because of the current political and economic environment,” Barron said. “But despite all that is happening, Ontario is still building. There is a big project pipeline of roads, transit, schools and hospitals that is driving optimism in construction across all regions of the province.”
Despite the optimism, challenges loom. 27% of contractors anticipate a decrease in work volume in 2025, and 35% remain concerned about escalating material costs. Labor shortages persist as a major concern, with 41% of contractors identifying it as a top challenge. These shortages have led to significant cost increases, project delays, and the necessity of employing less qualified labor.
The industry is actively addressing these challenges. The use of apprentices is increasing, with 64% of contractors employing at least one apprentice, demonstrating a commitment to developing the future workforce. Technology is also playing a crucial role, with 85% of contractors recognizing the importance of adopting new technologies. The use of advanced building materials has risen to 41%, and AI adoption is experiencing rapid growth. Currently, 18% of contractors utilize AI, and this figure is projected to increase to 21% within the next five years.
“ “The use of AI has exploded over the past couple of years, and construction cannot expect to be excluded from that,” Barron said. “As is typical, we are seeing many of the larger firms lead the way, but this is a number we expect will continue to grow over the years.”
The survey also sheds light on the impact of political and economic factors. Contractors view the provincial government’s policies as more supportive of the construction industry compared to federal policies. However, the survey, conducted before the eruption of the trade war with the United States, did not fully capture the potential impact of tariffs and counter-tariffs. The OCS plans to conduct further research to understand how these trade tensions are affecting the industry.
Ontario’s construction industry faces a dynamic future. While government investment in infrastructure and technological advancements provide reasons for optimism, challenges such as rising costs, labor shortages, and political uncertainty require ongoing attention. The OCS Contractor Survey serves as a valuable tool for understanding the industry’s current state and future prospects, highlighting the resilience and adaptability of Ontario’s construction sector.
