Construction sector’s GDP rises, but still facing tariff, labour challenges: report
Summary
Canada's construction sector saw a 1.3% GDP growth in Q3 2026, driven by engineering activities, but faces challenges from rising costs and labor shortages.
Why It Matters
This report highlights the construction sector's resilience amid economic challenges, emphasizing the impact of tariffs and labor shortages on future growth. Understanding these dynamics is crucial for stakeholders in the industry to navigate potential risks and opportunities.
Key Takeaways
- Construction sector GDP grew by 1.3% in Q3 2026, marking the largest quarterly gain in 3.5 years.
- Rising costs due to tariffs and supply chain disruptions pose significant risks to the sector's growth.
- A projected shortfall of 108,300 workers by 2034 highlights the urgency of addressing labor challenges.
Construction sector’s GDP rises, but still facing tariff, labour challenges: report Senakw, an Indigenous-led housing development under construction, is silhouetted in Vancouver, B.C., Friday, Aug. 1, 2025. THE CANADIAN PRESS/Darryl Dyck By Sammy Hudes, The Canadian Press Posted January 29, 2026 6:00 am. Last Updated January 29, 2026 8:04 am. Canada’s construction sector generated growth in its most recent quarter but continues to face rising costs, especially due to ongoing tariffs. The Canadian Construction Association’s winter 2026 economic insights report said the sector’s GDP was $170 billion in the third quarter, up 1.3 per cent compared with the previous three-month period and outpacing the all-industry average of 0.5 per cent growth. It marked the largest quarter-over-quarter gain in the last 3.5 years and the sixth consecutive quarterly increase, as growth was driven primarily by engineering and other construction activities. Construction sector GDP also grew by 2.6 per cent year-over year, while the all-industries average grew by 1.1 per cent. Increased productivity came despite higher construction costs and supply chain disruptions, the report said, saying those represent “a major ongoing risk.” The Building Construction Price Index, which the association uses to measure the total cost of constructing a typical building in 15 of Canada’s largest markets, rose 4.2 per cent year-over-year in the third quarter. The increase was driven by higher costs for metal fabr...
