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Solving shortage of construction workers key to housing growth

Addressing the persistent shortage of construction workers is crucial for Canada's housing growth, according to experts. The Canada Mortgage and Housing Corp. (CMHC) identified the scarcity of construction labor as a primary factor contributing to prolonged construction times in a recent report on housing supply.

The construction labor shortage is exacerbated by several factors, including the retirement of workers at a faster rate than they are being replaced. This issue was exacerbated by the pandemic, which prompted some construction workers to change careers or retire early instead of returning to the industry when the economy reopened.

Jordan Thomson, senior manager of infrastructure advisory at KPMG in Canada, emphasized the urgency of the situation, stating that the industry is facing the challenge of replacing retiring workers while simultaneously expanding to meet the growing demand for housing.

Kevin Lee, CEO of the Canadian Home Builders’ Association, estimated that approximately 22 percent of residential construction workers are expected to retire over the next decade. While the impact of the labor shortage has been somewhat mitigated by reduced demand due to high borrowing costs, a rebound in the market could intensify the strain on the sector.

A report titled "The Great Rebuild" by RBC assistant chief economist Robert Hogue highlights the need for aggressive expansion of the construction sector's labor pool. The report suggests various measures to address the shortage, including prioritizing construction skills among new immigrants and increasing enrollment in skilled trade schools.

The federal government has also recognized the importance of addressing skilled labor shortages in the construction industry. The recent budget includes measures to encourage more people to pursue careers in the skilled trades and facilitate the recognition of foreign credentials for construction workers. Additionally, funding has been allocated for apprenticeship programs to train the next generation of skilled workers.

Mary Van Buren, president of the Canadian Construction Association, emphasized the need to prioritize immigrants with skilled trade backgrounds to alleviate the immediate shortage. She noted that while progress has been made, the current immigration system tends to favor higher education over vocational skills.

Van Buren also highlighted the global nature of the construction labor shortage, with countries like the U.S., U.K., and Germany facing similar challenges. She emphasized the importance of innovative solutions, such as prefabricated homes and increased digital tools, to improve productivity in the construction industry.

In conclusion, addressing the shortage of construction workers is essential for Canada's housing growth. By implementing targeted strategies to attract and retain skilled workers, along with embracing innovative construction methods, Canada can meet the growing demand for housing and remain competitive on the global stage.



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