Transcript bta.ca

Construction and Maintenance
Looking Forward
Alberta
An Assessment of Construction Labour Markets from
2014–2023
Construction and Maintenance
Looking Forward
Alberta
Contents






Introduction and highlights
Economic environment and investment outlook
Construction labour requirements
The available workforce
Market rankings and mobility
Conclusion
Note: Definitions, methodology and detailed tables are available
at www.constructionforecasts.ca.
Introduction
Construction and Maintenance Looking Forward 2014–2023

Reports on the state of construction labour markets in Alberta from 2014 to
2023 are based on:
– a current macroeconomic and demographic scenario
– scenario for construction and maintenance spending in residential and
non-residential sectors
– a current inventory of major construction projects
– the views and input of provincial labour market information (LMI)
committees
 The BuildForce labour market model covers 33 trades and occupations:
“The BuildForce construction workforce.”
 This group includes on-site workers – 75 percent of the full construction
workforce.
– Statistical reliability is limited by small populations in some provinces, but in
Alberta, all 33 trades and occupations are covered.
Highlights
Recent cycle: 2007–2012






By 2007, employment had almost doubled its historical levels.
Job losses in 2009 marked an abrupt interruption to the accelerating growth
in Alberta construction employment that began in 1997.
More than 10 years of accelerating growth had reduced unemployment to
record low levels and recruiting from outside of Alberta became standard
procedure.
From 2007 to 2009, employment declined by 13 percent, but then recovered
by 20 percent between 2009 and 2012.
Since 2009, unemployment had approached more normal levels, but
remained below historical values and recruiting from out of the province had
resumed.
A rising proportion of the arriving workforce were “non-resident” employees
(i.e., not permanent residents).
Highlights
2013




Growth continued in 2013, but at slower rates:
– housing, commercial and industrial activity was rising
– some major engineering projects were winding down
Employment was up – mostly in residential – with total gains below recent
annual averages.
Unemployment remained very low and out-of-province recruiting continued.
Calgary floods set up late-year shifts in activity with large emerging
requirements.
Highlights
2014–2023







Project announcements and flood damage add to the demand requirements
into 2014 and 2015.
A residential cycle causes home building to weaken from 2016 to 2019.
Oil sands projects lead a surge in non-residential investment from 2014 to
2019.
As the oil sands industry matures and capacity grows larger, employment
shifts from new capital projects to increased ongoing maintenance work and
sustaining capital projects over the long term.
Housing revives and oil sands work eases off after 2020.
There are very limited opportunities for local workforce mobility within the
province.
Recruiting from out of the province continues near record levels until 2020
and in-mobility is divided between non-resident employment and permanent
additions to the workforce.
Economic environment
Canada





Canada’s economic growth is forecast to be relatively stable over the next 10
years, averaging 2.2 percent annual growth.
Strong private investment will remain instrumental to the country’s growth, as
relatively lower commodity prices and sluggish economic recovery across
Canada and the rest of the world constrains growth.
The attempts of the federal and provincial governments to reduce their
deficits will slow government spending.
Short and long-term interest rates remained low in 2013, reflecting the need
to keep the recovery going, but are expected to rise subsequently as the
Federal Reserve Board and the Bank of Canada react to potential higher
inflation.
The Canada-U.S. exchange rate is expected to remain strong in the short
term, but fall toward its underlying value over the scenario period.
Canada and U.S. 3-month
treasury bill rates
(%)
7
Forecast
6
5
4
3
2
1
Canada 3-month t-bill rate (%)
Source: BuildForce Canada
U.S. 3-month t-bill rate (%)
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Economic environment
The rest of the world



The speed of recovery for developing and emerging economies is expected
to outpace that of the developed ones over the medium term, despite a
slowdown in growth.
Over the longer term, growth in the developed economies will remain below
that of developing ones as a result of slower population growth and the fiscal
constraint associated with the need to reduce large government deficits.
Canada’s largest trading partners include the United States, Europe and
Japan. As a result, export demand is expected to grow in line with economic
growth in the advanced economies.
– The outlook for major trading partners is weaker in the short term,
due to consumer and government austerity and policy uncertainty.
– There is expected to be improvement in the medium to long term, with
deficit and debt reduction leading to increased business and consumer
confidence.
Economic environment
Commodities: oil and gas


In the short term, real commodity prices are expected to remain weak, but
relatively high in historical terms.
Subsequently, prices are expected to increase over the forecast period:
– Oil prices, as measured by the WTI at Cushing, are assumed to exceed
their previous peak of about US$100 per barrel in 2017, while those for
natural gas as measured at the Henry Hub are not expected to return to
their previous peak.
– The relatively weak performance of natural gas reflects the large
increases in the amount of gas that is expected to be obtained from shale
gas deposits across North America.
Oil and gas prices
Nominal US$ (see relevant y-axis)
140
30
Forecast
120
25
100
20
80
15
60
10
40
5
20
WTI oil/BBL (left axis)
Source: BuildForce Canada
Henry Hub gas/MMBTU (right axis)
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
0
2000
0
Economic environment
Commodities: metals and minerals


Prices for metals and minerals are expected to weaken in the short term as a
result of weak global growth prospects.
While prices are assumed to increase over the long term, the increases will
be much smaller than those observed over the past few years.
– The outlook for base metals is largely influenced by the outlook for
China’s economy and the intensity of metals in overall production in its
economy. Growth in the Chinese economy is expected to continue, but
the intensity of metal use is expected to decline as the economy
diversifies, moving from goods toward services.
– Real prices for precious metals are expected to decline as (i) institutional
investors increasingly consider them less attractive “safe haven”
alternatives and (ii) due to weakening physical demand for them.
Metals and minerals prices
(Index 2007=100)
120
Forecast
100
80
60
40
20
Metals and minerals
Source: BuildForce Canada
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
0
Housing starts and
household formation*
60,000
Forecast
50,000
40,000
30,000
20,000
10,000
Source: BuildForce Canada
Housing starts
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Household formation
* Household formation refers to the change in the number of households (persons living under one
roof or occupying a separate housing unit) from one year to the next. It is the means by which
population growth is transformed into demand for new housing.
Residential construction
investment
$2007 millions*
16,000
Forecast
14,000
12,000
10,000
Calgary floods add spending
8,000
6,000
4,000
2,000
Source: BuildForce Canada
New housing
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Renovation
* $2007 millions indicates that the investment values are in year 2007 dollars (base year), that is,
adjusted for inflation. This is used to calculate the real physical year-to-year change of the value
of construction, factoring out growth (increase value) due to increases in prices.
Residential construction labour
requirements
Residential construction employment



Spending related to flood damage drives up activity late in 2013 and into
2014.
– Flood-related work builds a cycle into renovation spending, as work is
concentrated in 2013 and 2014.
There is a moderate housing cycle; turning down in 2016 and up in 2019.
Residential construction employment grows by just under 6,500 jobs
(14 percent) from 2014 to 2023.
Residential construction labour
requirements
Residential construction employment

Trades and occupations most impacted by the new housing cycle include:
– construction managers
– sheet metal workers
– tilesetters
– trades helpers and labourers
Residential construction
employment index
Selected trades (Index 2009=100)
210
Forecast
190
Index 2009 = 100
170
150
130
110
Total (all trades)
Trades helpers and labourers
Source: BuildForce Canada
Construction managers
Sheet metal workers
Tilesetters
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
90
Residential construction labour
requirements
Residential construction employment

Trades and occupations most impacted by renovations activity and flood
damage work include:
– floor covering installers
– refrigeration and air conditioning mechanics
– residential and commercial installers and servicers*
– residential home builders and renovators
– roofers and shinglers
* Residential and commercial installers install and service a wide variety of interior and exterior
prefabricated products such as windows, doors, electrical appliances, water heaters, fences, play
structures and septic systems at residential or commercial properties. Example titles: aluminum window
installer, eavestrough installer, electric appliance installer, exterior cladder, fence erector, hot tub
installer, kitchen cupboard and vanity installer, recreation structure erector, siding installer, sign installer,
swimming pool installer, water conditioner servicer, water heater servicer, window installer.
Residential construction
employment index
Selected trades (Index 2009=100)
170
Forecast
160
Index 2009 = 100
150
140
130
120
110
100
Source: BuildForce Canada
Total (all trades)
Refrigeration and air conditioning mechanics
Residential and commercial installers and servicers
Floor covering installers
Residential home builders and renovators
Roofers and shinglers
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
90
Non-residential construction
investment
$2007 millions*
35,000
Forecast
30,000
25,000
20,000
15,000
10,000
5,000
Source: BuildForce Canada
ICI (institutional, commercial, industrial) building
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Engineering
* $2007 millions indicates that the investment values are in year 2007 dollars (base year), that is,
adjusted for inflation. This is used to calculate the real physical year-to-year change of the value
of construction, factoring out growth (increase value) due to increases in prices.
Building construction
investment
$2007 millions*
6,000
Forecast
5,000
4,000
3,000
2,000
1,000
Source: BuildForce Canada
Industrial building
Commercial building
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Institutional building
* $2007 millions indicates that the investment values are in year 2007 dollars (base year), that is,
adjusted for inflation. This is used to calculate the real physical year-to-year change of the value
of construction, factoring out growth (increase value) due to increases in prices.
Non-residential construction
labour requirements
Non-residential building



There is a late-2013 and 2014 surge in commercial, institutional and
industrial work related to the flood.
Activity switches back to new building construction from 2015 to 2023 with:
– a short-term drop in 2015 as flood work ends
– steady growth as the Alberta economy grows from 2016 to 2023
Labour requirements for ICI (industrial, commercial and institutional) work
grow more slowly than engineering and resource work from 2016 to 2019
and then provide a steady increase in jobs from 2020 to 2023.
Engineering construction
investment
$2007 millions* (see relevant y-axis)
20,000
Forecast
18,000
14,000
16,000
12,000
14,000
10,000
Oil sands ramp up
Other projects wind down
12,000
8,000
10,000
8,000
6,000
6,000
4,000
4,000
2,000
2,000
Other engineering (left axis)
Oil Sands (left axis)
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
0
2007
0
Roads/highways/bridges (right axis)
Source: BuildForce Canada
* $2007 millions indicates that the investment values are in year 2007 dollars (base year), that is,
adjusted for inflation. This is used to calculate the real physical year-to-year change of the value
of construction, factoring out growth (increase value) due to increases in prices.
Non-residential construction
labour requirements
Major engineering and industrial projects




Many large engineering projects are underway and ending in 2013-2014.
Major projects (excluding oil sands) starting up include:
– flood repair (roads, bridges) ending in 2014
– electrical generation and transmission (renewable and conventional)
– pipelines (including Energy East)
Oil sands projects include:
– in-situ projects scheduled to start up in 2015-2016 and then build toward
a peak in 2019
– Fort Hills starts in 2014
As the oil sands industry matures and capacity grows larger, employment
shifts from new capital projects to increased ongoing maintenance work and
sustaining capital projects over the long term.
Non-residential construction
labour requirements
Major engineering and industrial projects

Oil sands projects dominate employment demands for:
– boilermakers
– carpenters (scaffolding)
– construction managers
– contractors and supervisors
– crane operators
– Electricians
– Heavy equipment operators and mechanics
– insulators
– ironworkers (structural and reinforcing)
– sheet metal workers
– steamfitters and pipefitters
– trades helpers and labourers
– welders
Non-residential construction
employment index
Selected trades (Index 2009=100)
230
Forecast
210
Index 2009 = 100
190
170
150
130
110
Source: BuildForce Canada
Total (all trades)
Carpenters
Contractors and supervisors
Insulators
Steamfitters, pipefitters and sprinkler system installers
Welders
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
90
Boilermakers
Construction managers
Electricians (including industrial and power systems)
Ironworkers
Trades helpers and labourers
Crane operators
Construction labour
requirements
200,000
Forecast
180,000
160,000
Employment
140,000
120,000
100,000
80,000
60,000
40,000
20,000
Source: BuildForce Canada
Residential
Non-residential
Total
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
The available workforce
Unemployment




Unemployment in 2014 is heading down and approaches the record low set
in 2007.
There is virtually no pool of local labour available for recruiting.
Demographic limits on the younger population grows across the scenario
period.
Both natural and actual unemployment decline into the future.
The available workforce
Replacement demand* and mobility




The supply of skilled labour must be recruited from outside the local markets.
Requirements in Alberta for BuildForce trades and occupations are rising in
related industries, including fabrication.
Recruiting will come from out of the province, including:
– non-resident employment (inter-provincial employment and temporary
foreign workers)
– permanent in-migration
The distribution of in-migration varies by labour requirements. For instance:
– oil sands and other resource work draws on non-resident employment
– replacement demands require permanent in-migration
* Replacement demand refers to the loss of workers due to retirement and mortality.
The available workforce
Mobility

From 2014 to 2023:
– the labour force increases by 38,000
– replacement demands (retirements + mortality) increase by 37,500
– new entrants into the construction workforce (aged 30 and younger) are
approximately 30,000
– the construction industry will need to recruit around 45,500 workers from
other industries (i.e., in-mobility)
The available workforce
Mobility


Most of these 45,500 in-migrants will be needed permanently to replace
workforce losses.
– A balance of labour requirements will be filled with non-residents.
This pattern of adjustment is not evenly distributed across the scenario, with
– recruiting of non-residents focused on the timing of oils sands projects
– permanent in-migration needed across the entire scenario for growing
maintenance and sustaining capital work
The available workforce
25,000
Forecast
Total change in labour force =
New entrants + Net in-mobility - Retirements
20,000
Number of workers
15,000
10,000
5,000
0
-5,000
-10,000
-15,000
Retirements and mortality
Source: BuildForce Canada
New entrants
Net in-mobility
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
-20,000
Total change in labour force
Labour market rankings
1
Qualified workers are available in local markets. Excess supply
is apparent. Workers may move to other markets.
2
Qualified workers are available in local markets.
3
Qualified workers in the local market may be limited by
short-term increases in demand. Established patterns of
recruiting are sufficient.
4
Qualified workers are generally not available in local markets.
Recruiting may extend beyond traditional sources and practices.
5
Qualified workers are not available in local markets. Competition
is intense.
Labour market rankings:
Alberta – overall
Trades and occupations
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Boilermakers
3
4
4
4
4
4
4
4
3
3
3
Bricklayers
3
4
4
3
3
3
3
3
3
3
3
Carpenters
4
4
4
4
3
3
3
3
3
3
3
Concrete finishers
3
4
3
3
3
3
3
3
3
3
3
Construction estimators
4
4
4
4
3
3
3
3
3
3
3
Construction managers
4
4
4
4
3
3
3
3
3
3
3
Construction millwrights and
3
3
3
3
3
3
3
3
3
3
3
industrial mechanics
Contractors and supervisors
3
4
4
4
3
3
4
3
3
3
3
Crane operators
3
4
4
4
3
3
4
3
3
3
3
Drillers and blasters
4
4
3
3
3
3
3
3
3
3
3
Electricians (including industrial and
3
4
4
4
3
3
3
3
3
3
3
power systems)
Elevator constructors and
3
3
3
3
3
3
3
3
3
3
3
mechanics
Floor covering installers
3
4
3
3
3
3
3
3
3
3
3
Gasfitters
4
4
4
3
3
3
3
3
3
3
3
Glaziers
3
4
3
3
3
3
3
3
3
4
4
Heavy equipment operators (except
3
4
3
3
3
3
3
3
3
3
4
crane)
Heavy-duty equipment mechanics
3
4
3
4
4
4
4
3
3
3
4
Labour market rankings:
Alberta – overall (continued)
Trades and occupations
Industrial instrument technicians and
mechanics
Insulators
Ironworkers and structural metal
fabricators and fitters
Painters and decorators
Plasterers, drywall installers and
finishers, and lathers
Plumbers
Refrigeration and air conditioning
mechanics
Residential and commercial installers
and servicers
Residential home builders and
renovators
Roofers and shinglers
Sheet metal workers
Steamfitters, pipefitters and sprinkler
system installers
Tilesetters
Trades helpers and labourers
Truck drivers
Welders and related machine operators
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
3
3
3
4
3
3
3
3
3
3
3
3
4
4
4
4
3
4
4
3
3
3
3
4
4
4
4
4
4
3
3
3
3
3
4
3
3
3
3
3
3
3
3
3
4
4
4
3
3
3
3
3
4
4
4
3
4
3
3
3
3
3
3
3
3
3
4
4
4
3
3
3
3
3
3
3
3
3
4
3
3
3
3
3
3
3
3
3
4
4
4
3
3
3
3
3
4
4
4
4
3
4
4
4
4
3
4
3
4
3
3
3
4
3
3
4
3
4
3
4
3
3
4
5
5
4
4
4
4
3
3
3
4
4
3
4
4
4
3
3
3
3
3
4
3
3
3
3
3
3
3
3
4
3
3
3
3
3
3
3
3
3
3
3
3
3
4
4
4
4
4
4
3
3
3
3
Alberta oil sands
Oil sands highlights
Projects and schedules




The Fort Hills project increases requirements in 2014 and 2015.
A long list of in-situ projects are anticipated from 2016 to 2019, with a notable
pause in growth in 2018 and acceleration in 2019.
Associated demands for construction of electricity and pipeline infrastructure
is included in other non-residential activity.
Rankings for oil sands markets are focused on the annual increase in labour
requirements.
– There is evidence of a very high proportion of non-resident employment
(i.e., fly-in, fly-out).
CAPP oil sands production
(000s BBL/Day)
3,000
Forecast
2,500
000s BBL/Day
2,000
1,500
1,000
500
Raw in-situ
Source: BuildForce Canada based on Crude Oil Forecast, Markets and Transportation (CAPP, June 2013)
Raw mining
SCO
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
0
Oil sands construction
employment index
Selected trades (Index 2009=100)
340
Forecast
Index 2009=100
290
240
Pace of hiring decelerates and then declines
190
140
All trades
Source: BuildForce Canada
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
90
Oil sands construction
employment index
Selected trades (Index 2009=100)
350
Forecast
300
43,000 jobs added
2009–2019
Index 2009=100
250
200
23,000 jobs added
2014–2019
150
100
50
All trades
Source: BuildForce Canada
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
0
Labour market rankings:
Alberta oil sands
Trades and occupations
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Boilermakers
4
5
5
4
4
4
4
4
3
3
3
Bricklayers (primarily refractory)
4
4
4
4
3
3
4
3
3
3
3
Carpenters (including scaffolders)
4
4
4
4
3
3
4
3
3
3
3
Concrete finishers (cement masons)
4
4
4
4
3
3
4
3
3
3
3
Construction estimators
4
4
4
4
3
3
4
3
3
3
3
Construction managers
5
5
4
4
3
3
4
3
3
3
3
Millwrights
4
4
4
4
3
3
4
3
3
3
3
Contractors and supervisors
4
4
4
4
3
3
4
3
3
3
3
Crane operators
4
4
4
4
4
3
4
3
3
3
3
Electricians
4
4
4
4
4
3
4
3
3
3
3
Heavy equipment operators (except
crane)
4
4
3
4
3
3
4
3
3
3
4
Labour market rankings:
Alberta oil sands (continued)
Trades and occupations
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Heavy-duty equipment mechanics
4
5
4
4
4
3
4
4
3
3
4
Industrial instrument technicians
4
4
4
4
3
3
4
3
3
3
3
Insulators
4
4
4
4
4
3
4
4
3
3
3
Ironworkers (structural and
reinforcing)
4
4
4
4
4
4
4
3
3
3
3
Painters
4
4
4
4
3
3
4
3
3
3
3
Sheet metal workers
4
4
4
4
4
3
4
3
3
3
3
Steamfitters, pipefitters
4
5
5
4
4
4
4
4
3
3
3
Trades helpers and labourers
4
4
4
4
3
3
4
3
3
3
3
Truck drivers
4
4
4
4
3
3
4
3
3
3
3
Welders
4
4
4
4
4
4
4
3
3
3
3
The available workforce
Mobility




Rankings are intended to capture market conditions unique to Alberta.
Implied mobility signals Alberta requirements, not the available workforce in
other provinces.
Engineering and resource project demands in other provinces dominate this
analysis.
– The strongest competing demands for key trades will come from British
Columbia, where mining, electricity, pipeline and LNG* projects start from
2015 to 2018.
Projects are scheduled to wind down in Newfoundland and Labrador in 2015,
with variable conditions in Saskatchewan from 2015 to 2020 and in Ontario
across the scenario period.
* Liquefied natural gas
The available workforce
Mobility (centres of resource construction)

Major projects in rural or remote areas require a specialized workforce,
including:
– boilermakers
– construction managers and estimators
– construction millwrights crane operators
– electricians
– heavy-duty equipment mechanics
– plumbers
– steamfitters and pipefitters
– welders
Labour market hot spots
Our thanks to …
The production of Construction and Maintenance Looking Forward 2014−2023 would not
have been possible without the valuable input from the following organizations:

















Alberta Advanced Education and Technology
Alberta Construction Association
Alberta Employment and Immigration
Alberta Finance and Enterprise
Alberta Roadbuilders and Heavy Construction Association
Building Trades of Alberta
Canada Mortgage and Housing Corporation
Canadian Home Builders’ Association – Alberta
Canadian Natural Resources Limited
Christian Labour Association of Canada
Construction Labour Relations – Alberta
Enbridge Inc.
Merit Contractors Association
Nexen Inc.
Progressive Contractors Association of Canada
Service Canada
Syncrude Canada Ltd.
About BuildForce Canada
Originally created in 2001 as the Construction Sector Council, BuildForce
Canada is a national industry-led organization committed to working with
the construction industry to provide information and resources to assist with
its management of workforce requirements.
Like many industries, the construction industry faces a number of human
resource challenges. These include the need to accurately forecast labour
demand and supply, to increase the mobility of workers, to make the most
of new technologies, and to cope with an aging workforce.
This report is part of BuildForce Canada’s Labour Market Information
Program. It is also available in both official languages and can be obtained
electronically at www.constructionforecasts.ca.
For more information, contact:
BuildForce Canada
Phone: 613-569-5552
[email protected]
February 2014