Prime Minister Mark Carney's plan to transform Canada's economy includes overlapping segments that could end up competing for a shortage of skilled labor that could lead to cost overruns, according to a new report from Deloitte.
The plan has three pillars: dual housing construction, accelerating major projects and attracting $500 billion in private investment.
But all three initiatives implemented simultaneously would require between 410,000 and 520,000 additional workers by 2030, representing about a one-third increase in the current number of construction workers, according to
“We appear to be setting the stage for another perfect storm, this time on a national scale, in which governments, businesses and developers are simultaneously competing for the same group of retail workers,” the report says.
Deloitte points to two previous cases where several large projects cannibalized workers and resulted in cost overruns due to staffing competition.
In 2022, four megaprojects in British Columbia—Coastal GasLink, Trans Mountain Expansion, LNG Canada and Site C—reached peak construction around the same time, leading to a bidding war for workers that led to additional costs and delays.
Deloitte said a similar scenario occurred for about 15 years during Alberta's oil sands boom.
“If the 'build, baby, build' ambitions materialize, the national labor market could begin to look a lot like British Columbia and Alberta during peak periods, when activity is held back not by a lack of money or projects, but by a lack of available workers,” the report says.
At the same time, Canada is seeking to reduce the number of immigrants in an attempt to ease the housing crisis and the strain on public services. The country plans to welcome 365,000 new permanent residents in 2027, up from 471,771 in 2023.
Deloitte recommends that the federal government prioritize construction workers among new Canadians.
To meet labor demand, Deloitte also recommends attracting underrepresented groups into the professions, such as women, youth and people of color, and retraining workers in other occupations into higher-demand occupations.
“This issue cannot be resolved by any one actor,” the report says. “This will require a coordinated and sustained effort from the federal and provincial governments, employers and project owners, colleges and training providers, apprenticeship bodies and trade unions.”
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The Canadian economy added 60,000 jobs in September, with all new jobs coming from full-time positions.
Manufacturing, a sector hit hard by US President Donald Trump's tariffs, reported its first job gain since January, adding 28,000 jobs in September.
The job numbers meant unemployment in Canada remained stable at 7.1 per cent.
The numbers are encouraging for the Canadian economy, but economists remain mixed on what this could mean for interest rates.
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Today's Posthaste was written by Ben Cousins with additional reporting by staff from the Financial Post, The Canadian Press and Bloomberg.
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