Residential construction a big driver for economy

The Canadian residential construction industry continues to be a major driver of the national economy, the latest annual report from the Canadian Home Builders’ Association says.

The association’s 2015 Economic Impacts of Residential Construction study found new construction, renovation and repair accounted for more than one million jobs last year, making the industry one of the country’s largest employers. In the same year, the “investment value” of new home construction, renovation and repair — a value that accounts for all expenditures except land — exceeded $128 billion, Statistics Canada building permits data shows.

The report highlights that housing is still doing well, while the rest of the economy isn’t, says CHBA CEO Kevin Lee. The industry comprises small and medium enterprises that create jobs “and really drive the economy,” he says.

Renovations outstripped new home construction nationally and in Ottawa last year. Countrywide, renovation and repair accounted for 54.4 per cent, or $70 billion in investment value, compared with 45.6 per cent, or $58.7 billion, for new construction. In Ottawa, renovation and repair weighed in at 52.6 per cent, or $2 billion; new construction amounted to 47.4 per cent, or $1.7 billion.

Lee expects renos and repairs to lead the industry charge “indefinitely” as our housing stock continues to grow.

The housing industry reported $58 billion-plus in wages nationally last year. Other benefits range from tax revenues and spending at local businesses, to large donations from builders to hospitals and other local institutions.

The CHBA’s latest report isn’t necessarily a good news story locally says John Herbert, executive director of the Greater Ottawa Home Builders’ Association.

For example, new home construction starts are down about 25 per cent over the past four years, Herbert says, and he doesn’t expect that to change much next year. The slowdown, he says, has a “significant impact on jobs and tax (revenues).”

In Ottawa, housing jobs last year amounted to more than 20,000 — slightly more than half of them in renovation and repair. That ratio is close to that of the province as a whole, where there were 174,873 jobs in renovations and repairs last year compared with 156,758 in new construction.