Perspectives 2010 :Construction activity will increase by 3% in 2010
07 décembre 2009
“We are forecasting an increase of 3% for the construction industry overall in 2010,” stated Mr. André Ménard, president and CEO of the Commission de la construction du Québec (CCQ), to an audience of some 250 participants from employer and union associations, construction companies, the associative milieu, and the education sector at the 8th annual conference organized by the CCQ. “With $45 billion of investments throughout Québec, all sectors will be in growth mode in the majority of regions. I can assure you that the labour force will be up to the task of supporting Québec’s economic development.”
In 2009, the construction industry was not overly affected by the financial crisis or the recession. Next year, it should reach a volume of work totalling 137 million hours worked, or 3% more than in 2009. This will be a peak unequalled in more than 30 years.
The strength of construction during 2009 was not coincidental. In fact, governments used construction as one of the principal motors of economic recovery. As public projects represent two-thirds of investment in non-residential construction in Québec, the measures undertaken have had a positive impact on the economy.
“Many governments around the world adopted recovery plans in late 2008,” Mr. Ménard noted. “In Québec we were ahead of the game, since the Québec infrastructure program was launched in 2007 and was the cornerstone of the Québec economy’s recovery.”
Civil engineering and roadwork sector: Expansion continues in 2010
In 2010, the volume of work will increase by 7% in civil engineering and roadwork, which will again be the star sector in the construction industry. Major work sites already underway will continue.
Thanks to numerous public investments in 2009, the volume of work in the civil engineering and roadwork sector shot up by 15%. Roadwork and infrastructure projects grew by 20%. Hydro-Québec also increased its investments. Work activity at the Eastmain-1-A–Sarcelle–Rupert complex was at its maximum level, while work on transmission lines intensified.
Residential sector: Growing next year
Prospects are positive for residential construction in 2010. The CCQ estimates that as the economic recovery gets rolling, hours worked should increase by 4% in this sector. This recovery will take place against a background of data indicating a growing population. While in the recent past forecasts saw an imminent drop in the formation of households in Québec, estimates now call for the creation of 45,000 per year. This optimistic outlook is due mainly to a rise in the number of immigrants admitted to Québec and a mini-baby boom. Thus, a comparable number of dwellings should be built in coming years.
Although the volume of activity dropped in 2009, residential construction still provided a pleasant surprise. The number of housing starts dropped slightly, but not catastrophically. In 2009, there were 43,000 housing starts, compared to 48,000 in 2008 (–10%). However, hours worked dropped by only 7% over the same period.
Institutional and commercial sector: a slight rise next year
For 2010, the CCQ forecasts a modest rise in activity in the institutional and commercial sector. Institutional construction should remain strong, but it is still awaiting the boost to be provided by construction of the university hospitals. The CCQ expects commercial construction to remain stagnant for a little while longer, until the signals of economic recovery are more robust. The construction of offices nevertheless shows good potential. In total, the volume of work should rise by 1% in 2010.
The volume of work in the institutional and commercial sector dropped by 6% in 2009. One might have feared the worst for this sector, composed of two-thirds commercial sites, but institutional construction saved the day with its numerous hospital and school renovations. In the commercial area, the construction of stores, hotels, and restaurants slowed, while that of recreational and office buildings fared better.
Industrial sector: A 5% rise in 2010
The volume of work in industrial construction should increase by 5% in 2010 over 2009. This sector will be counting on mine projects and a gradual improvement in other industrial sub-sectors. Industrial construction, which has been in difficulty for several years, has been the most adversely affected by the recession.
The aluminum industry has announced promising projects, but is awaiting a more solid economic recovery, as is the chemical and petroleum products industry. Meanwhile, the pulp and paper industry is no longer the major work provider that it once was. Only the mining industry is seeing a strong resurgence, as gold has reached unprecedented peak prices.
Labour-force needs: More than 14,000 new workers per year
The CCQ estimates that the industry will need 14,000 new workers annually from now to 2013. These new workers will enable the industry to cope with the forecast increase in volume of work and numerous departures of workers, due to retirement or other reasons. The construction sector offers good prospects to young people and to others reorienting their careers. The industry currently has almost 145,000 employed workers.
“For a number of years,” Mr. Ménard observed, “the construction industry has demonstrated its capacity to meet the challenge of growth and maintain its employment level.”
“Since 2002, we have admitted between 11,000 and 15,000 new workers per year, and we are doing everything in our power to ensure that our workers are skilled through initial training and upgrading of employed workers,” Mr. Ménard noted in conclusion. “Our labour-force diversification strategies will help us meet the demand in coming years. I am referring to recognition of skills and experience of workers from other sectors, other provinces, and other countries, such as France, and the inclusion of new clienteles, such as Aboriginals, women, and immigrants.”
You can download documents linked to the conference below (PDF files, in French only):
Allocution du PDG de la CCQ, M. André Ménard, dans le cadre de la 8e conférence annuelle sur les perspectives économiques de l'industrie de la construction du Québec
Perspectives 2010 de l'industrie de la construction, présentation de Pauline Dupuis et de Patricia Carvajal, économistes à la Direction recherche et organisation.
La construction : au coeur de la relance économique, présentation de Louis Delagrave, directeur, Direction recherche et organisation.
Perspectives économiques nord-américaines, présentation de Carlos Leitao, économiste en chef et stratège à la Banque Laurentienne.