February 29, 2012

Construction activity will reach record high levels in Saskatchewan

Construction activity in Saskatchewan will gradually rise to a peak over the next two years and then plateau above historical levels, which is creating a labour shortage and shifting employment patterns in both the residential and nonresidential sectors.

“Saskatchewan has experienced remarkable growth in the last few years and it is pretty clear we have managed to avoid a recession in many ways,” said Saskatchewan Construction Association (SCA) president Michael Fougere. “The projected number of new workers will barely replace what we will lose over the next decade, let alone fill demand for new building.”

Fougere recently released the Construction Sector Council’s labour market forecast for Saskatchewan at a press conference in Regina.

According to the report, non-residential construction employment will rise to a peak in 2013 and will remain close to that level until 2020.

This gradual rise and plateau will be characterized by some important shifts among the sub-sectors.

“The most volatile employment patterns occur in the large engineering and industrial projects, while commercial and institutional construction experiences a more gradual increase,” said the report.

“Engineering construction peaks in 2013 and then declines moderately, remaining well above historical levels across the remainder of the scenario period from 2014 to 2020. This pattern reflects the completion of several major mining and utility projects from 2012 to 2013 and the start of three major mining projects between 2011 and 2013.”

Since 2001, Saskatchewan’s labour force has increased from around 23,000 workers to an estimated 37,500 in 2011.

Work on known major projects is expected to peak in 2013.

The forecast predicts labour requirements for these projects will create a shortage of skilled labour in 2012 and 2013.

The specific trades and occupations that are linked to these industrial and resource industries in Saskatchewan include: boilermakers; concrete finishers; construction estimators; construction managers; construction millwrights; crane operators; heavy equipment operators; ironworkers; steamfitters and pipefitters; and truck drivers.

“There is still a labour shortage and there is certainly a demand for trades over and above what is available,” said Fougere.

“There will have to be a greater focus on retaining the workers that are here.”

Since the last of these scheduled projects will be underway by 2014, the workforce will gradually decline to average 35,000 workers by 2020, which is well above historic levels. This pattern coincides with an increase in replacement demand related to the retirement of an estimated 6,600 workers.

An estimated 6,100 new entrants will enter the workforce to fill the overall increase in labour requirements.

Fougere said there is a lot of anecdotal evidence that indicates that construction activity is not leveling off, but will continue to rise until 2020.

The shift in labour requirements for major industrial and engineering projects will be partly offset by gradual and steady growth in commercial and institutional work from 2012 to 2020.

These gains provide non-residential work for another group of trades, including: floor covering installers; glaziers; insulators; painters and decorators; plasterers and drywall installers; refrigeration and air conditioning mechanics; and tilesetters.

Non-residential construction employment rises to a peak in 2013 and remains close to that level until 2020.

“Unlike most other provinces, new housing construction and renovation work will likely continue at a steady pace until 2020,” said Alan Thomarat, president of the Canadian Home Builders Association of Saskatchewan.

“There are concerns about the potential demand for skilled workers due to retirements and competition for labour from other provinces.

The entire construction industry is taking a proactive approach to recruitment, retention, training and development.”

Moderate volatility in new housing construction is balanced by steady, but limited, gains in renovation and maintenance work.

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