Steady growth as confidence rebuilds

Looking ahead, construction activity is set to increase in 2026, but gains are limited and largely subdued. Public sector investment will lead the rebound with committed government expenditure supporting constrained investment appetites. Private sector activity is expected to lag initially but should gain traction as interest rate reductions filter through and confidence returns.

Workloads should accelerate in 2027 as market conditions improve and sustained public sector expenditure unlocks private sector investment. Growth thereafter should be relatively steady, albeit construction costs could suppress development appetites as higher volumes of work exacerbate labour shortages and feed into supply chain pressures.

Residential construction is expected to remain mixed through 2026 as elevated costs, soft pre-sales and lending constraints limit near-term momentum. Activity should be positioned for stronger performance by 2027 as structural pressures and public-sector housing initiatives restore builder confidence.

Single-family construction should stay subdued in 2026 despite new housing tax credits, with higher land prices restricting project viability. Meanwhile multi-dwelling construction remains resilient as government densification policies and a pivot toward affordable and quick-delivery formats sustain activity. Build to rent, rather than sale, will be better positioned for growth.

Institutional segments are expected to see solid growth through 2026, underpinned by capital programs that prioritize health and education, as well as streamlined approvals and long-term demand. Increased outlays on defence projects and programs will be a mainstay as well. However, deficit-cutting targets in multiple provinces could slow the pace of project approvals as 2026 unfolds.

The industrial sector is expected to face another cautious year in 2026 as oversupply and tariff uncertainty temper investment decisions. A gradual recovery is anticipated starting in 2027 as demand for digital infrastructure and domestic manufacturing strengthens.

Growing workplace modernization efforts to boost in-person attendance suggest a more favourable backdrop for commercial activity through 2026, albeit workloads may be skewed towards fit‑outs rather than new developments. Recovering confidence and increases in consumer spending should contribute to retail improvements in the longer term as well.

Repair construction is expected to be stable in 2026 as households and asset owners continue to prioritize essential, lower-value maintenance. However, rising costs have paused several maintenance programs, denting sector fortunes. Still, consistent repair work on public infrastructure pieces such as highways and utilities should put a floor under near-term growth.

Finally, civil engineering workloads are set to pick up through 2026, reinforced by the allocation of CA$115bn over the next five years to national infrastructure programs. These multi‑year commitments should anchor stable growth, although labour shortages and supply chain volatility may impact budgets and timelines.