Canada’s construction sector is growing as a recent BuildForce Canada report found employment rose to 1.25 million in 2025. BuildForce forecasts that growth to continue in the years ahead, particularly in nonresidential work.
Despite the top-line growth, the report finds the industry will need significant amounts of workers both to replace a retiring workforce and fill new hiring needs. Firms that develop their existing labour force and consider less common labour pools will likely be best positioned to meet face that environment.
Nonresidential employment sees growth outpaced by retirement
Nonresidential construction employment grew two per cent in 2025, according to the BuildForce report. Expansion is expected to continue, with the nonresidential workforce growing seven per cent to a peak of around 700,000 workers by 2035. ICI construction and maintenance work are expected to drive those gains, while engineering is projected to decline.
The challenge stems from the number of workers exiting the labour force. BuildForce projects 20 per cent of Canada’s construction workforce will retire in the next 10 years, leaving nonresidential hiring needs at 188,700 by 2035. The incoming workforce is not expected to meet this demand, leaving a shortage of more than 30,000 workers expected by 2035.
Population slowdown pulls residential employment expectations down
Residential construction employment also rose two per cent in 2025, but the outlook differs sharply from nonresidential.
Slowing population growth is expected to soften demand for new homes, and BuildForce projects residential employment to dip through 2028 before recovering modestly. By 2035, residential employment is expected to settle four per cent below 2025 levels, as forecast gains in renovation and maintenance work fall short of offsetting declines in new construction.
The smaller projected workforce narrows the sector’s labour gap relative to nonresidential. BuildForce projects the sector will need 117,500 new workers by 2035; 113,600 are expected to join, leaving a shortage of 3,900.
What it means for construction
The shortages projected in both sectors will sharpen competition for labour. As construction investment continues, firms will find themselves competing for a shrinking pool of workers, particularly in nonresidential work.
In this environment, retaining the workforce already in place is becomes increasingly important. Firms that invest in training, competitive pay and a strong work culture will spend less replacing experienced workers as turnover becomes more costly as the available pool shrinks.
The industry should also look to traditionally underrepresented labour pools. Women account for roughly six per cent of onsite construction employment and Indigenous peoples for less than five per cent, despite being the fastest-growing population in Canada. Similarly, new immigrants are underrepresented relative to their share of the broader labour force. As population growth slows and the labour gap widens, these three groups could be key to filling it.
Devin Bell is the associate economist for ConstructConnect.
