By Jock Finlayson, ICBA Chief Economist
Employment in the B.C. construction industry is closely tied to developments and trends in the wider economy. The current situation is no exception. As economic growth has slowed in Canada and B.C. since 2022, net job creation in the construction sector has downshifted and the job vacancy rate as measured by Statistics Canada has eased somewhat. That said, the construction industry remains a foundational part of the overall economy, directly making up 8.8% of total B.C. employment (and ~11% of private sector employment) in 2023.
On a seasonally adjusted basis, the number of construction jobs in the province has been hovering in the range of 227,000 to 235,000 so far in 2024. Last year, construction jobs reached 235,000 (average annual), little changed from 2022 but down from a peak of 250,000 positions in 2019. The drop in construction employment partly reflects the impact of higher borrowing costs/interest rates in the last couple years, the winding down of work on a few large energy projects, and an increasingly difficult and costly operating environment for the industry.
Within the B.C. construction sector, jobs are distributed across the key industry segments as summarized in Table 1. Trades contracting accounts for more than half of employment in the industry, followed by residential building. The other two segments are non-residential construction and heavy, civil and engineering construction.
Figure 1 charts the trends in construction employment in B.C. over the last two decades, showing total industry employment as well as the number of positions in the main industry sub-sectors. A few observations can be made about the picture presented in Figure 1:
First, trades contracting consistently has provided a majority of all construction jobs in B.C. Within this category, the biggest components are building equipment contractors and building finishing contractors. This underscores the fact that trades contracting employment is inextricably tied to the level and growth of building construction spending generally.
Over the last two decades, total construction employment in the province has basically doubled, climbing from 118,000 jobs in 2003 to 235,000 last year. In the same period, total employment rose from 2 million to 2.8 million. Thus, job growth has been much stronger in the construction sector than in the economy as a whole. Construction looms larger today as an economic engine for the province than it did 15 or 20 years ago.
The residential building sector is more labour-intensive than the non-residential building segment. In most years, residential building employment has been 4-6 times greater than non-residential building employment.
Heavy and civil engineering construction is a modest but economically valuable component of the overall construction industry. Typically, it accounts for 8-11% of construction jobs in B.C. The level of spending (public and private) on infrastructure development, refurbishment, and maintenance plays an important role in driving and sustaining employment in this segment of the industry.
Looking ahead, ICBA Economics projects further growth in overall construction employment in British Columbia. This reflects the province’s expanding population, the continued need to invest in building new and refurbishing existing infrastructure assets, and ongoing economic and industrial development.
