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COVID 19 Disrupts Canadian Construction

COVID-19 Disrupts The Canadian Construction Industry

As we are now six weeks into a world-wide pandemic, we are looking at the Canadian construction industry to see how they are coping and what we can expect in terms of progress and costs. As an essential service, many sites forge on, but the decline in the availability of workers, accessibility to key construction materials, and delays associated with adapting site safety measures, are all leading to major disruptions across the industry.

About Canadian Construction

The construction sector is one of Canada’s largest employers and a significant contributor to the country’s economy. The industry employs more than 1.5 million Canadians and contributes to 7 per cent of Canada’s Gross Domestic Product (GDP). In March, the Canadian Construction Association (CCA) released it’s standardized protocols for all Canadian construction sites – a living document that is updated with the guidance of public health authorities. It highlights best practices and a consistent national approach to protect the well being of all those in the industry.

An Essential Service

Many job sites across the country have remained open and are subject to the recommendations set out by provincial governments across Canada. Mary Van Buren, President of the CCA is quoted in a March press release,

“The projects we deliver are fundamental to Canadians’ quality of life and to the success of our country. In many cases, they support the delivery of essential services, including the clean water we drink, energy infrastructure and the power grid, critical transportation infrastructure, and the hospitals and other health care facilities where we receive care.”
Public Safety Canada supports Van Buren’s claims and explicitly states which sectors of construction are essential on their website here. Yet, many provinces included commercial, residential, industrial, and institutional sectors in their lists of essential workers, including BC, Alberta, and Ontario.

Impacts on Construction Sites

Several provinces across Canada have declared a state of emergency, including Ontario, British Columbia, Alberta, Manitoba, and Nova Scotia. The provinces of Ontario and Québec have additionally issued all non-essential workplaces to be suspended until further notice. While in Québec, all residential construction has been shutdown between March 25 to April 20, some workers returned to residential construction sites to help the province avoid a housing crisis.  Exact figures are unknown as to how many private sector construction sites for residential and commercial use have remained open, but it is suspected that most have continued on despite disruptions and concerns from workers.

Reduced Productivity

The most obvious source of delay occurs from a full project shutdown, following a government order to suspend all work. Projects are experiencing low productivity due to understaffing and physical distancing. Physical distancing measures put forth by the federal government is restricting the number of people on-site and imposing an increased control of site movement. An example of this can be seen in developments where elevators and hoists are used; with only two workers at a time on a 40-storey tower trying to get to their floor[,] that’s an hour per person lost every day (minimum).

Worried Workers

The CCA claims that the construction industry already has “highly disciplined health and safety protocols” which are being “significantly amplified” based on recommendations put forth by public health officials. However, construction workers have voiced concerns about the inability to put the added protocols into practice. Jack Da Silva, an agent for Labourer’s International Union of North America (LiUNA) Local 183, was captured on video on an unidentified site in downtown Toronto stating,

“When you’re in the work site there, you guys don’t have six feet around you. We’re all breathing on each other. Where’s your eating facilities? Are they sanitized? Do you have water to wash your hands when you eat your sandwiches?”
A Labourers’ Union business agent’s video plea for safer site conditions in Toronto during the COVID-19 pandemic has been captured and broadcast.

After the recent outbreak at the Kearl Lake oil sands facility in Alberta, these concerns are legitimate and protocols need to be taken seriously and implemented to the fullest extent.

Supply Chains Affected

The disruption in supply chains is also putting a strain on construction projects due to restricted border access and limited manufacturers. While Canada has made efforts to keep supply chains open for trade and commerce, such as the Canada-US border, the decline in manufacturing from other countries is starting to have an impact.

In 2019, China was Canada’s second biggest source of imports, behind the U.S. (which supplies half of what Canada buys). However, much of the items that are imported to Canada from the US require materials which the US imports from China. At the peak of the Covid-19 pandemic, China had shut down factories which were responsible for producing 80% of it’s exports. The Port of Vancouver – a major hub for import goods has reported fewer container vessels due to reduced cargo-loading activities at Chinese ports. There will be a trickle down effect as we deplete our existing inventories, and despite China’s manufacturing beginning to pick up again, demand will continue to slow from it’s major trade partners in North America and Europe.

Dennis Darby of Canadian Manufacturers and Exporters (CME) said that manufacturers cannot shift their delivery models like other industries. “The production workforce can’t work from home. The local and international supply chains of production components will become restricted and their customers will limit purchases.”

Construction Costs

How construction costs will be impacted is still too early to be seen. It will depend entirely on how long the pandemic continues. The Altus Group has an interesting opinion piece on this that explains a short-term recovery from COVID-19 could see stabilized and perhaps even increased costs, whereas a long-term shutdown will see heavy declines. For a more detailed read, view the article here.

Final Thoughts

The construction industry and its costs are always fluctuating, similar to the fluid developments of COVID-19. The CCA is calling on the Government of Canada to issue a clear statement and work towards future legislation on how it will handle delays, project disruptions, and other costs incurred due to the outbreak. The construction industry plays a vital part in Canada’s overall economic health, so continuation of that sector is imperative for economic recovery. However, precautions must also be taken to ensure the safety of its workforce.

Normac is taking precautionary measures to protect our staff, clients, and to do our part in preventing the further spread of COVID-19. Read more about our efforts here.

Cover image from blogTO, 3 Workers Test Positive For COVID-19 At Toronto Construction Site: https://www.blogto.com/city/2020/03/3-workers-test-positive-covid-19-toronto-construction-site/

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