Canadian construction activity stuttered in 2023. Revised data now shows four successive falls in quarterly Gross Value Added (GVA), with Q4 2023 activity 2.3 percent lower than the corresponding period in 2022. January 2024’s GVA reading also shows an industry stuck in a rut, with activity falling by 0.5 percent on the month and 3.5 percent on the year.

Civil engineering and other construction activities lagged the most at the end of 2023. In Q4 2023 activity fell by 3.8 percent on the previous quarter and 1.3 percent on the year. While these decreases can be explained in part by previous very high levels of investment, and Infrastructure Canada’s 2024-2025 Departmental Plan has set a framework for further development, it cannot be assumed that the sector will be immune to the wider construction industry’s slowdown.

On a positive note, residential activity improved in Q4 2023, growing by 1.3 percent on the quarter for the second period in a row. Non-residential activity also increased, rising by 1.6 percent over the same period as industrial and manufacturing and institutional and governmental workloads remained buoyant.

From a building permit perspective, a key lead indicator for the industry, the start of 2024 was positive. The number of building permits granted (seasonally adjusted at constant values) jumped by 8.5 percent on the month and showed healthy gains on the year, growing by 5.4 percent in February 2024. Much of this improvement came from the industrial sector, which grew by 62.5 percent on the month and 16.7 percent on the year.